Oral Answers to Questions

HOME DEPARTMENT

The Secretary of State was asked—

Immigration Strategy

Andrew Love: If he will make a statement on the implementation of the five-year immigration strategy.

Andy Burnham: We are making good progress on all the major projects in the strategy. The first stages of the new accelerated asylum process are in place. We expect to handle all new claims under   the new process by September next year, and the   number of removals is increasing month on month. The public consultation on the new points system for economic migration, which we launched in July, closes today.

Andrew Love: I thank the Minister for that reply. He will be aware of recent decisions in relation to the removal or non-removal of asylum seekers to Zimbabwe. My constituents, particularly those from Somalia, have expressed concern about the inappropriate and premature removal of their families and friends. My constituents from Sri Lanka are worried about the human rights considerations of such removals where country agreements are in place. Can the Minister give some assurance that removals are made only where appropriate safeguards are in place?

Andy Burnham: I can give my hon. Friend that assurance. Obviously, great care is taken by the immigration service to ensure that before a removal can take place, an individual is properly identified and documented. The documentation, of course, is important for their removal to be able to take place. With regard to removals to Zimbabwe, we are considering the verdict given by the asylum and immigration tribunal some days   ago, but we continue to consider matters on a case-by-case basis, and to take appropriate decisions as a result.

Peter Lilley: Can the Minister explain why his plan for migration does not include a single reference to the Government Actuary's forecast that net immigration will add 6 million to the population of this country within 25 years? Why is there no provision for the land that will need to be set aside for the dwellings that will have to be built to house those people? Can he confirm that his colleague in another place has forecast that a third of new households in this country will be the result of net immigration in future?

Andy Burnham: What I can tell the right hon. Gentleman is that the Government will certainly not accept an arbitrary quota on migration, which was proposed by his party at the general election, and which I believe would be highly damaging to the British economy. We will not be going down that path, if that was the thrust of his question. The net contribution to our economy made by migrants should be celebrated, and it is high time that he and his party stopped playing politics with the issue and began to welcome the genuine contribution that economic migrants make to our country.

Martin Linton: Is my hon. Friend aware that as recently as 1997, many of the people who came to our surgeries had been waiting seven or eight years for an asylum interview, never mind a decision? Will he tell us what the average time is now for an initial decision on asylum cases and the time that it takes for removal?

Andy Burnham: I am grateful for that question, as my   hon. Friend raises an important point. When the Government came to power, the average time that it took for a case to be processed, I believe, was some two   years. That left families and individuals in an unacceptable kind of limbo, and made it all the more difficult to remove someone at the end of the process. In answer to his question, we have greatly reduced the time taken: in the vast majority of cases, a decision is made within a two-month time frame. He is right to point to the need for continued progress in this area, but I am pleased that he and I can celebrate the progress that has been made.

James Clappison: Is the Minister aware that last month saw the publication of statistics showing net inward migration to this country of 223,000 in 2004, which was far more than the Government's estimates? According to the Office for National Statistics, it was the highest number since the present method of estimation began. Can the Minister say whether he expects his managed migration policy to result in a higher or lower level than 223,000?

Andy Burnham: What I can say to the hon. Gentleman is what I said to his right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley) a moment ago. We will take decisions on levels of migration that are good for the British economy. If he wants me to set limits irrespective of the damage done to the British economy, that is a policy that Conservative policy should state openly and allow people to debate. If that is the way that he wants to go, I would be interested to hear the discussions between him and the CBI about that proposal.

John Robertson: Is my   hon. Friend aware that families are now receiving early-morning visits in relation to deportation back to their countries of origin, and that those visits appear to   be over-aggressive, with those involved wearing combat gear of body armour and using handcuffs? Can he explain why that is happening?

Andy Burnham: My hon. Friend has raised some important issues. Removals are always difficult and present the immigration service with issues that are hard to deal with, but I assure my hon. Friend that they are always carried out as sensitively as possible. Early-morning visits tend to be made at a time when the family will be together, for obvious reasons, but they are not made before 6 am, and are normally made between 6 am and 7 am.
	I take my hon. Friend's point about the manner in which removals are carried out and the equipment used, but I assure him that great care and attention are exercised, and will continue to be exercised, following the concern expressed by him and other Labour Members.

Dominic Grieve: I apologise on behalf of my right hon. Friend the Member for Haltemprice and Howden (David Davis), who cannot be here this afternoon.
	May I return the Minister to his answer to my right hon.   Friend the Member for Hitchin and Harpenden (Mr. Lilley)? What is illegitimate about raising the issue   of   the desirability of large-scale population increase   following immigration? While I acknowledge that immigration can make good economic contributions to the country, it is a crowded country where the quality of life and environmental issues are important. Why is it wrong, as the Minister said it was a moment ago, to raise questions about the rate of population increase resulting from immigration? Will the Minister please explain what objection led him to fly into such a temper just now?

Andy Burnham: I am sorry that the right hon. Member for Haltemprice and Howden (David Davis) could not spare time for us here in the House today. Presumably he had more important things to do out on the campaign trail. Presumably he is going up and down the country trying to win votes with a hard-line right-wing agenda.
	I believe that it was the right hon. and learned Member for Rushcliffe (Mr. Clarke) who said last week
	"The trouble is when the Conservative Party has got in difficulty in recent years, there has always been a temptation to give"—

Mr. Speaker: Order. I should prefer the Minister's responsibilities to be discussed at the Dispatch Box.

Andrew MacKinlay: When Lech Walesa comes here later this week, will the Minister stay very close to him so that he can listen to Conservative Members of Parliament who sneak up and say that they fought for Polish freedom? Will he also take the opportunity to point out that they are the people who criticised the Prime Minister's generous, sensible and prudent policy of allowing Polish people to come and   work here from day one of Poland's entry to the European Union? Will he ensure that the Polish people are reminded of that before the next European and municipal elections? They will be able to vote in those elections—for the party that allowed them to come here and contribute to the United Kingdom's economy, not for that lot.

Andy Burnham: My hon. Friend is absolutely right. The contribution made by accession-country nationals to our economy since we gave them the opportunity to work here has shown that to be the right decision for the British economy, for this country in Europe and for Poland. If the Conservatives oppose the free movement of labour around Europe, they should come out and say so.

West Mercia Police

Philip Dunne: If he will make a statement on the performance of West Mercia police.

Paul Goggins: The police performance assessments published by the Home Office and Her Majesty's inspectorate of constabulary on 27   October show that in 2004–05 the West Mercia police force achieved a very positive assessment of its performance across the range of its core policing activity. All delivery grades are either good or excellent, and most direction grades have improved.

Philip Dunne: I am sure that the Minister agrees that we should congratulate Paul West, the chief constable, on the fact that his force not only achieved those grades but   was the top-performing force in the country, on the   Minister's own criteria. How does he reconcile that   outstanding performance with his Department's arbitrary decision, made during the current "Closing the Gap" consultation, that there should be a minimum force size of 4,000 officers? West Mercia has just proved that, with only 2,400 officers, it can deliver the best performance for the best value in the country.

Paul Goggins: I am happy to join the hon. Gentleman in praising Paul West and all his officers and staff for their tremendous achievements. They have cut crime in their area by 13 per cent. Burglary, for example, is down by 22 per cent. However, there is no contradiction between giving that praise clearly in the House and elsewhere and accepting the advice of Her Majesty's inspectorate that, in order to deal with terrorism and serious organised crime and ensure that neighbourhood policing is not taken away from local communities, we need to have strategic forces of the size that it suggests: 4,000 officers and 6,000 staff. Those are not arbitrary figures. Her Majesty's inspectorate judges that those are the numbers that we need.

Michael Foster: May I add my congratulations to the chief constable and the team at West Mercia? What is the Minister's assessment of the position in relation to violent crime in West Mercia and the police's performance overall on that aspect? In making that assessment, can he perhaps refer to adverts that were carried across West Mercia just a few months ago, paid for by the Conservative party, that said that violent crime went up in West Mercia when, in West Mercia and in many other regions, it actually went down?

Paul Goggins: I am grateful to my hon. Friend for making that important point. I confirm that in the past year in West Mercia, robbery went down by 19 per cent., so it is a safer place to live in. Again, the police deserve praise for that. In relation to the change that is being suggested by the inspectorate and the need to ensure that we have robust strategic police forces, there is no blueprint. My right hon. Friend the Secretary of State for the Home Department has no blueprint for the forces that will emerge. He wants to hear from local opinion. Hon. Members on both sides of the House will be able to contribute to that consultation.

Daniel Kawczynski: rose—

Andrew MacKinlay: What about Poland?

Daniel Kawczynski: No, we are talking about West Mercia at the moment. We will leave Poland for another day.
	West Mercia police authority is overstretched at the moment, particularly in rural Shropshire. Why is it that West Mercia receives less per head than all the surrounding police authorities?

Paul Goggins: The police authority in the hon. Gentleman's area received a fair assessment and a fair allocation, but he has just used an interesting word—"overstretched". In fact, as we have discussed, the police are performing remarkably well. Think about how the police in his area will deal with the threats posed by terrorists and serious organised crime and the increasing pressure that that brings. If we do not make these structural changes now, there will be a tendency for police to be drawn away from the local neighbourhood and local communities that he may represent. It is in order to get that balance right that we need to press ahead and to form these new larger strategic forces.

Chief Constables (Vacancies)

Mark Pritchard: How many chief constable vacancies there are; and if he will make a statement.

Hazel Blears: There are currently three chief constable vacancies and all three are being filled on a temporary basis.

Mark Pritchard: That is quite a revelation. I have been informed, perhaps misinformed, that there are currently five vacancies. Whether it is three or five, does the Minister share my concern—[Interruption.] I know why hon. Members want to shout me down. They do not want to hear what I have to say. Does the Minister share my concern, in the context of the global terror that we live with, that three, or possibly five, major police forces are having their command and control diminished by those vacancies? Is it not another example of the Government driving through their regional agenda before full consultation has taken place?

Hazel Blears: No, I entirely reject the hon. Gentleman's assertion. I ask him to check his numbers. We have three vacancies. Cambridgeshire has decided to make an appointment for a 12-month period because of the pending restructuring. Lancashire and Norfolk both   have temporary appointments in place. They are ensuring that their forces have good leadership and a proper command team. The purpose of looking at the restructuring of our forces is to ensure that they have the   capacity and capability to look at the range of challenges and threats that they face.

Lindsay Hoyle: My right hon. Friend will be aware that Lancashire not only does not have a chief constable, but its deputy chief constable has left. The police authority's failure to appoint is serious. It is unacceptable that, as we move towards a merger with perhaps Merseyside or Cumbria, a force the size of Lancashire does not have someone with a strong enough voice to outline what good policing in Lancashire is. It is too important; can she do something about it?

Hazel Blears: I understand my hon. Friend's concern and he is a great champion of policing in Lancashire. We have just published the police performance assessment and Lancashire is doing an extremely good job; it is one of our really good forces, with two excellent grades, three good grades and two fair grades. The force is going in the right direction. My hon. Friend will always be keen to make sure that his area gets the very best policing, but he will agree that the force is doing a good job. I have no doubt that the members of the command team will keep their eyes on the ball and make sure that they are delivering to the people of Lancashire.

Tim Boswell: Is not the real problem that the present surplus of chief constables rapidly may be converted into a glut as a result of the Government's headlong pursuit of a policy of regionalisation of our forces, under which my village of Aynho in the south-west of Northamptonshire may well soon be under the same policing command structure as Skegness, where, if my constituents are of good behaviour, they may hope to go across the entire east midlands to spend their holidays?

Hazel Blears: The hon. Gentleman will be well aware that the basic unit of policing in his area will be a command unit with a borough commander, which is the basis on which neighbourhood policing will be provided. We have a commitment to ensure that every community, urban and rural, has a dedicated, available and accessible neighbourhood policing team by 2008. People will have the team's mobile phone numbers and can contact them, and they will have the same officers for two or three years. That is the way in which the hon. Gentleman's constituents and others across the country will be able to see that they have neighbourhood police officers, dedicated to making sure that their streets are safe and their communities more secure.

David Borrow: In cases of a merger between police forces, will the appointment of the new chief constable be restricted to the chief constables of the forces being merged, or will the new police authority have discretion to look within a wider pool of police officers for the new chief constable?

Hazel Blears: It is important that the debate be led by police authorities and police forces, and it must involve Members of Parliament and local councils. That is why the current consultation is led from the areas themselves and not from the centre by Government. We want to make sure that people locally can make the right decisions. I cannot say at this stage what the procedure will be in terms of that recruitment process, but I am clear that the police authorities need to be fully involved in the process so that they get the command teams that can do the job we want them to do.

Patrick Cormack: If the Minister is genuinely anxious to consult and to listen, will she consider the views of those who believe that emulation of the best is rather better than amalgamation of the rest?

Hazel Blears: I can give the hon. Gentleman an assurance. When he came to see me last week—with other Members of Parliament from Staffordshire, including some of my hon. Friends—he will have had the sense that was I listening to the points that were made. We are a listening Government—[Interruption.] We are a listening Government, and we are flexible, pragmatic and practical. We want to make sure that when the new structures are in place they are fit for purpose. The point is that Her Majesty's inspectorate of constabulary said that the current 43-force structure is   not fit for purpose and it is the responsibility of any   Government to take seriously the advice of the inspectorate and to try to make sure that our structures have the capacity, capability and resilience to be able to protect our citizens from the threats we face.

Counter-terrorism

Jim Dobbin: If he will make a statement on EU co-operation on counter-terrorism.

Charles Clarke: Counter-terrorism has been a top   priority for this EU Presidency even before the July   attacks in London, in the belief that international co-operation is absolutely essential to combat terrorism. Key areas of work include agreeing framework decisions on the European evidence warrant, simplifying the exchange of information and dealing with the retention of telecommunications data. While the prime responsibility for protection of citizens remains a national one, effective EU co-operation is a key element in the fight against terrorism.

Jim Dobbin: As a member of the European Scrutiny Committee, I took part in a European Parliament justice and home affairs debate on the European arrest warrant. The impression was given during that debate the Interpol and Europol do not have a strong and close working relationship. What is my right hon. Friend going to do to try to improve that relationship, particularly in respect of counter-terrorism?

Charles Clarke: My hon. Friend is entirely correct to identify the issue of co-operation between police forces and international organisations. I am glad to say a recent agreement between Europol and Interpol has led to a tangible increase in strategic co-operation. They now have joint incident response teams and are involved in joint contingency planning for terrorist attacks. This country is working to support such co-operation, and two members of the National Crime Squad are working in Europol's national liaison unit to achieve better relations overall. The deputy director of Europol is at Interpol today, discussing matters of mutual interest. I acknowledge the thrust of my hon. Friend's question, but things are improving.

David Heath: The Home Secretary mentioned that he has been actively seeking agreement on the issue of data retention by mobile phone companies. We read that he has now concluded a British agreement with O 2 . Will that agreement survive any takeover—indeed, perhaps it may be extended to other Telefonica-owned companies; will the same terms be available to other companies; and does this mean that he accepts that he will not secure an agreement during the British EU Presidency?

Charles Clarke: On the contrary, this Government, like other Governments, have agreements with telecommunications companies on the retention of data. The Council of Ministers has said that an agreement will be reached by the end of this year, and I am confident that that will be the case. I am working to extend that agreement to the European Parliament, so that it, too, is part of the process. The message will be much stronger if all institutions—the Commission, the Council and the European Parliament—work jointly to fight terrorism. That is what I am seeking to achieve, and I am confident that we will do so.

David Anderson: Part of the response in countering terrorism is the introduction of identity cards. Will the Home Secretary comment on this weekend's London School of Economics report, which states that the cost of ID cards will rocket even higher than the figure predicted before the recess?

Charles Clarke: I have a simple, one-word comment on the LSE report, and it is the same as that on its previous report: nonsense—a load of nonsense. We have set out the figures very clearly, and ID cards contribute to our ability to defend ourselves against terrorism and serious and organised crime. That is one reason why we are promoting the Bill before the House of Lords.

Michael Fabricant: For how many days can suspected EU terrorists be held without trial in Europe?

Charles Clarke: As the hon. Gentleman, who is a distinguished parliamentarian, will know, the legal systems of the various EU countries are very different indeed. As the Foreign Office report indicated, the answer to that question is up to four years—depending on which country one is talking about—under a system of investigating judges and magistrates, which, as I said, is a different situation. Such long periods of detention in those countries need to be borne in mind when we consider the form of such legislation in this country.

Edward Garnier: There is no   doubt that wider international, as well as EU, co-operation is essential in dealing with terrorism. But does the Home Secretary accept that the Prime Minister's somewhat petulant statement this morning on the 90-day detention proposal undermines the Home Secretary's authority and his rather more rational approach to counter-terrorism law, and damages his ability to advance EU co-operation on counter-terrorism?

Charles Clarke: The Prime Minister and I have a very clear position in dealing with these matters.

John Bercow: But it suffers from the disadvantage of being wrong.

Charles Clarke: The hon. Gentleman says that, but the fact is that the police and some three quarters of the   people of this country think that we need to be able   to deal with the situation properly. He may disagree, but we do not. Returning to the question, international co-operation is important, which is why we are trying to work very closely internationally. That is the right way for us to proceed.

Domestic Violence

Lyn Brown: What steps he is taking to monitor the impact of recent domestic violence legislation.

Fiona Mactaggart: The national delivery plan for domestic violence, published in March 2005, sets out eight performance indicators that are used at national, police force and local level to monitor the impact of action against domestic violence. The plan is performance managed by the inter-ministerial group on domestic violence and reviewed quarterly. The number of domestic violence cases that result in successful prosecutions has risen from 53 per cent. in 2004–05 to 59 per cent. in the first two quarters of the present year.

Lyn Brown: In March, the Home Office released a report that mentioned specialist courts for domestic violence cases to enable more support for victims and better advocacy. Will the Minister tell us how those courts are now delivering?

Fiona Mactaggart: This year we will be rolling out 25 specialist courts and eight are already in place. The pilot, which revealed what those courts could achieve, showed that in Caerphilly, guilty pleas increased from 21 to 27 per cent. and by September this year they had averaged 61 per cent.—an indication of their increasing success. Convictions in court went up from 8 per cent. to 19 per cent. in the pilot period and they have now reached 32 per cent. Victim withdrawals, which have been a particular problem with domestic violence cases, went down from 53 to 27 per cent. in the pilot period and have now decreased further to 17 per cent. In addition, together with the specialist courts, domestic violence advocates help women to go through all the complications of the different bits of the system that deal with domestic violence—ensuring not only that they get successful convictions, but that the system meets those women's needs rather than their having to meet its needs.

Andrew Turner: According to the British crime survey, nearly a third of domestic violence cases—more than 300,000 incidents a year—take place under the influence of alcohol and the average number of attacks that a victim suffers before calling the police is 35. While some excellent work is being done to make perpetrators confront their behaviour, do not those figures underline the importance of giving effect to sections in the Domestic Violence, Crime and Victims Act 2004, which make assault an arrestable offence and make breach of injunctions a criminal offence? Why have they not yet been brought into effect and when will they become enforceable?

Fiona Mactaggart: The hon. Gentleman will be aware that under serious organised crime legislation, not just those but all offences will be given arrestable effect, and that will be happening shortly. The hon. Gentleman is right to say that that we need effective procedures to help reduce repeat victimisation. If we look at the impact of what we have already done—much more dynamic than anything done for a very long time—we can see that repeat victimisation is being reduced and that women are being made safer. The present proposal, which will be brought into effect in due course, is adding to what is already an effective programme of action to protect women and men against domestic violence.

David Chaytor: Would my hon. Friend accept that domestic violence can remain an issue long after the separation of the partners? There is a concern at present about contact orders between estranged partners being the subject of continued exploitation within the family relationships. Does she accept that the Children and Adoption Bill may provide an opportunity to improve the level of assessment that takes place in respect of former partners who have been guilty of domestic violence in the past? Will she look into that matter carefully?

Fiona Mactaggart: My hon. Friend will be aware that the courts inspection looked into issues surrounding the Children and Family Court Advisory and Support Service with the aim of ensuring that the right of parents to have access to their children does not put those children at risk. The Government are looking carefully at the recommendations and reflecting on whether any amendments to the Children and Adoption Bill, which is currently before the other place, might be necessary to protect children more effectively from the risk of domestic violence being committed by one of their parents.

DNA Database

Lynne Featherstone: What assessment he has made of the effectiveness of the national DNA database.

Andy Burnham: The national DNA   database is the biggest operational policing DNA database in the world. It now holds more than 3.3 million DNA profiles and provides the police with around 3,000 intelligence matches each month. The annual number of direct DNA detections more than doubled from 8,612 in 1999–2000 to 19,873 in 2004–05. In addition, a further 15,732 crimes were detected in 2004–05 as a result of further investigations linked to the original case in which DNA was recovered.

Lynne Featherstone: I thank the Minister for that answer, but I wonder whether he is aware that earlier this year figures showed that 32 per cent. of all black males in the UK were on the DNA database, but only 8 per cent. of white males. Does he recognise the growing concern about racial profiling and disproportionality in criminal investigations, and will he undertake to find out what underlies those figures?

Andy Burnham: I know that the hon. Lady has shown an interest in this subject and has tabled parliamentary questions on it. The data held on race profiles are not directly accurate, in that they are derived from the impressions of the police officer in the custody suite, not a statement by the individuals involved. There are therefore problems with providing the data that she requires. However, the procedures apply across the piece to people who have been arrested, so they are not discriminatory. Moreover, huge public benefit is derived from the database with regard to the detection of serious crime.

Gordon Prentice: But why are the police allowed to keep the swabs and the DNA of people who are not charged with any offence?

Andy Burnham: They are allowed to keep the DNA to help with the solving of serious crime. My hon. Friend will know that some serious offences have been solved by using the database. For example, in 2001 a shoplifter was arrested in Derby. His DNA was taken and found to match that in a rape that was committed in 1998 in Canterbury. If people are guilty of no crime, having their DNA on record can only help to ensure that they are not wrongly accused of a crime.

Paul Goodman: What discussions has the Minister had, or is intending to have, with his counterparts at the Department of Health about any connection between the database and the ID   card scheme, as well any connection between the   database and the new national computer network that the Department is introducing?

Andy Burnham: The national DNA database is not linked to the Department of Health. It is focused on the solving of serious crime and is a major operational tool for the police to use to ensure greater reliability in connecting the guilty to a crime. There is no direct link to the systems that the Department of Health is introducing. The Government have invested some £300 million in expanding the DNA database. If Opposition Members wish to challenge its results, I can confirm that it has helped to solve crimes throughout the country, with great benefits to the families of the victims of those crimes.

Brian Iddon: With an ever increasing number of people logged on the database, what consideration has my hon. Friend given to the advice of Professor Jeffreys, who discovered the DNA fingerprinting technique, that we should move from 10 to 16 markers in order to avoid wrongful convictions?

Andy Burnham: My hon. Friend is far more eminent in matters of science than I am, and I will of course consider seriously the point that Professor Jeffreys raises. We are ensuring that we use advances in technology and science to the maximum possible effect in the public interest, which—in this case—is solving serious crimes.

Drug Treatment (Offenders)

David Burrowes: What steps he is taking to ensure that offenders receive adequate drug treatment.

Paul Goggins: Drug treatment plays a key role in rehabilitating offenders and reducing reoffending. That is why we have developed a comprehensive structure to deliver drug treatment to offenders wherever they are in the criminal justice system, and have invested heavily in a range of programmes, including enhanced treatment in prison, the drug interventions programme and drug rehabilitation requirements for community sentences.

David Burrowes: I am grateful for the Minister's response, but does he share my grave concern about drugs in Pentonville? A recent inmate struggling to rehabilitate himself from drugs told me that the prison is awash with drugs, with cannabis bars thrown over the walls, and crack cocaine and heroin easier and cheaper to obtain inside the prison than outside. When will the Minister and the Government take action to deal with that scandal, which is happening not just in Pentonville but in prisons throughout the country?

Paul Goggins: The Prison Service, prison governors and my right hon. Friend the Minister for Policing, Security and Community Safety work hard to counter drugs being brought into our prisons. The problem is significant and nobody can deny it, but the failure rate for mandatory drug testing was 24 per cent. 10 years ago and it is now down to 11 per cent., so I hope the hon. Gentleman will recognise that that is an indication that the efforts of staff in all our prisons to reduce the amount of drugs coming into prison and being misused by people in prison are having some impact. I do not deny for a minute that the hon. Gentleman makes an important point: this is an evil and we need to continue to work together to bear down on it.

Cheryl Gillan: The Minister was recently in charge of prisons and knows that drug treatment for offenders is far from the success that he would have us believe. Not only are drugs literally pouring into our prisons, but nearly half of all who start drug treatment programmes in prison fail to complete them. There is a shortage of suitably qualified drugs workers in our prisons and the social exclusion unit found that even after receiving treatment in prison there is almost no support on release, so returning to drug taking and criminal activity is the easy option. As well over half the crime committed in this country is connected to drugs—

Mr. Speaker: Order. Supplementaries should be shorter.

Cheryl Gillan: I wondered, Mr. Speaker, when the Minister would make some real investment in aftercare and services.

Paul Goggins: May I express some mild surprise? The hon. Lady has carried her Front-Bench responsibilities for a long time and I know that she visits prisons and takes a deep interest in these issues, so how she can retain such a wholly negative assessment of the position baffles me, because she knows that many staff are working hard to turn people's lives around. The number of people employed to work with drug misusers has increased from 6,000 to 10,000 as a result of the massive investment that the Government have made, not just for offenders in prison but for offenders in the community; 55,000 offenders in prison were on a maintenance or detoxification programme last year and 40 per cent. of all prisoners are on voluntary drug testing. I do not think that her question reveals the full picture, which is more positive than her version of it.

Angela Watkinson: No matter how much drug rehabilitation treatment is provided, will the Minister acknowledge that as long as the Government's policy is based on harm reduction, for every drug addict who is cured 10 more will come along? Will he redirect his drug policy to drug prevention?

Paul Goggins: We will not be deflected from harm minimisation, because it is essential that people who misuse drugs are helped to get off them and that the people whose houses they burgle and whose lives are made a misery owing to that criminality can also be protected. We have invested massively in drug treatment: the pooled drug treatment budget increases to £478 million in two years—an astronomical increase. We are absolutely determined to ensure that when people caught up in criminality as a result of their drug misuse want to change their behaviour we will give them every assistance to do so, but if they will not change they will have to take the consequences.

Dennis Skinner: Is the Minister aware that he is fighting the problem with one hand tied behind his back? Prominent politicians are advocating taking drugs. The other year, half the Tory Front Bench admitted to taking them and now a prominent candidate for the leadership is suggesting that ecstasy should be downgraded. What chance have we got when that lot are involved in taking drugs?—[Interruption.]

Mr. Speaker: Order.

Police Officers (Administration)

Nigel Evans: What action he is taking to reduce the burden of administration on police officers.

Hazel Blears: We have made good progress in reducing the bureaucratic burdens on police officers by cutting almost 9,000 unnecessary forms, civilianising posts, rolling out the penalty notice for disorder scheme and ensuring that forces have the best scientific and technological support, such as video identity parades and electronic fingerprinting, so that our police spend more time in communities tackling crime and antisocial behaviour and reassuring the public.

Nigel Evans: Come off it. The Minister says that they are a listening Government. Why are they not listening to the police, who say that they are snowed under with   bureaucracy and paperwork? Is it little wonder that the police spend so much time in police stations and not on the streets where they should be? Why do the Government not start, for instance, with the form that the police must fill in every time they stop someone? It is   a foot long and it takes them seven minutes to fill in. Is it not about time that the Government did something about that?

Hazel Blears: I am afraid that the hon. Gentleman is wrong again. All the evidence shows that filling in most stop forms takes less than five minutes and that such encounters happen, on average, once every two and a half hours on patrol. I would commend to the hon. Gentleman PC Diederik Coetzee of Nottinghamshire police. He is a police officer in Mansfield and he has the record for the number of arrests this year—he has arrested 309 people. He said:
	"I am firm but fair. If they break the law they have to be brought to book."
	It is reported that he is "undaunted by the paperwork". He said:
	"It's not that horrendous . . . It comes with the job."
	He is out on the front line, arresting criminals and bringing them to justice, and he does not think that the paperwork is horrendous—it is part of the job.

Andrew Miller: Just occasionally, bureaucracy gets in the way. For example, in my constituency a partnership between local residents in Burton and the police using mobile speed detection devices has been blocked because of an absurd argument between Government officials and Ofcom about the wavelength that is used. Will my right hon. Friend knock a few heads together and get some common sense into this?

Hazel Blears: I would be delighted to do that. I am firm but fair, and I will certainly look at that problem. The kind of partnership project that my hon. Friend mentions is exactly the kind of thing that we want to   take place between police officers and local residents   working together to make their areas safer. So, I certainly give an undertaking to get on the job and on the case.

John Maples: Many hon. Members hope that the reorganisation of police forces on which the Government are consulting will lead to a reduction in administrative burdens, although we remain to be convinced of that. Those of us who represent rural areas with small police forces must weigh that against what we think will be a reduction in local democratic accountability and pressure on rural policing because big cities drag in more of the resources. Are the Government prepared, in response to that consultation, to entertain proposals that would create two levels of policing—one at regional or national level that would deal with very serious crime, thereby leaving local policing to locally accountable police forces?

Hazel Blears: Yes. We want to ensure that we have four levels of policing: at the very local neighbourhood level, then at basic command unit level, then at strategic force level, and then the national and international levels that we have now. We are about to establish the   Serious Organised Crime Agency, which will look at those national and international levels. However, it is   crucial that all those levels of policing should stay   connected because very often local community intelligence can help to tackle neighbourhood crime, more serious, organised crime and even international crime. I would not want those forces to become divorced   from one another. The concentration on neighbourhood policing is very much the top priority for me because that is where the public want to see their officers, and people should have that relationship with their local police in rural areas as much as in urban ones. Having strategic forces ought to reinforce the ability of the neighbourhood police because if there is a big murder in a small force, very often neighbourhood officers get taken away to deal with that complex crime, but bigger forces have the resilience to ensure that that does not happen.

Iain Wright: Police in my patch welcome the cut in the number of police forms that they must complete, but they complain that when an arrest is made they are taken off the streets into the police station, where they must fill in paper-based forms. Will my right hon. Friend permit the use, perhaps on a pilot basis, of electronic hand-held devices such as PDA to minimise bureaucracy in administration, as much as is possible, and ensure that police officers are on the beat for as long as possible?

Hazel Blears: I know that my hon. Friend has been campaigning on this issue for some time. I also know that he regularly goes out on patrol with his force, so he sees for himself what is happening on the ground. Several areas are piloting the use of hand-held computer devices, which means that officers do not have to go back to the station. The increasing civilianisation of custody suites means that officers can hand over prisoners to civilians to be put through custody, which means that more officers can be released to the front line so that they can patrol and give the public the reassurance that they want.

Nicholas Winterton: Will the   Minister really listen to the people of this country about policing? Although I accept the sincerity of her   responses, does she accept the point made by my hon. Friend the Member for Stratford-on-Avon (Mr.   Maples) that police services in rural areas are under-resourced compared with those in urban areas, which I believe receive a much more generous allocation? If the police do, as they say to me, have to fill in many forms, which keeps them in the police station, rural areas are clearly suffering from inadequate numbers of bobbies on the beat. It is the bobbies on the beat who prevent crime, so there is a huge incentive to get them on the beat so that they can prevent crime, rather than investigate it.

Hazel Blears: I entirely accept the enthusiasm and genuine sincerity with which the hon. Gentleman makes his point, but may I gently say to him that I do not believe that rural areas are under-resourced? Policing in this country is determined by a formula that examines the need for policing, and I genuinely believe that that formula is fair. I have to make the point to the hon. Gentleman—again gently—that under his Government, police officer numbers were cut by 1,200. Under this Government, the number has gone up by 12,000, and we now have 6,500 community support officers out on the   beat, who are reassuring the public as a visible uniformed presence. The Government are listening to the people of this country, who want more police officers and community support officers on the streets.

Mr. Speaker: Order. Perhaps the Minister can listen to the Speaker as well, and maybe we will get shorter answers.

Prisoners (Electronic Tagging)

Jon Trickett: If he will make a statement on the performance of contractors involved in the electronic tagging of prisoners.

Fiona Mactaggart: Electronic monitoring providers' compliance with contractual obligations is generally satisfactory. However, sometimes things do go wrong, and I would like to express my deep regret for the tragic murder of Marian Bates by an offender who was subject to electronic monitoring. Since then, electronic monitoring procedures have been strengthened and the Home Office has issued new guidance to prevent a similar tragedy occurring in future.

Jon Trickett: I thank my hon. Friend for that reply and share her concern about the individual whom she named. Does she share the anger of local people in my area, and the frustration of senior police officers, after discovering that a prolific local offender had been in breach of his tagging order 22 separate times and that Securicor, the contractor, had failed to inform the police of those breaches, which became apparent only when the man was arrested for committing a public order offence while in breach of his electronic tagging order for the 22nd time? Is that not a disgrace? Will the Minister carefully examine Securicor's behaviour?

Fiona Mactaggart: I am very keen to examine carefully any breaches of the agreement that we have with the electronic monitoring companies. One of the   changes to which I referred is that 100 per cent. of   actions by them are now monitored by us. A breach of the sort that my hon. Friend described would thus automatically affect the contract with the company involved. If he will provide me with further details of the   case, I will certainly look at it to ensure that it has been properly followed up. The scheme can be an effective way of monitoring offenders. It can help to regulate offenders' behaviour between prison and the community and have positive effects, but only if it is operated effectively by the monitoring companies.

Julian Lewis: Would not it deter offenders who had been tagged from removing their tags if they were informed that the price of removing the tag would be that they would serve the rest of their sentence in prison?

Fiona Mactaggart: That is possible. If someone breaches the conditions of their curfew or monitoring by removing their tag, they have to be sent back to court, which means they can be returned to jail, but the decision for how long they should serve is rightly made by the sentencer and not by a Government Minister.

Cheryl Gillan: Surely fulfilling contractual obligations is not enough. Two weeks ago I visited Group 4 Securicor's tagging headquarters and was surprised to learn from the company that it is not subject to an inspection regime. With more than 3,000 prisoners tagged and high-profile failures, why is there no specific provision for an inspection regime in this highly sensitive area?

Fiona Mactaggart: The company's performance is monitored regularly by staff employed by the Home Office, and they are required to report on a series of particular performance indicators, including how quickly breaches are reported and brought back to court, for example. Under the new contract, any failure on any case is counted as a breach. It is not a sampling system, as it was under the old contract.

Prisons (Sickness Management)

Edward Leigh: What steps he has taken to improve the management of sickness absence at the 10 prisons identified in the Public Accounts Committee's first report of Session 2004–05 as having the highest levels of sickness absence.

Fiona Mactaggart: A programme of management action has resulted in a reduction in sickness absence in the public sector Prison Service. That includes improved monitoring by senior managers, staff access to occupational health support, particularly for stress and back pain, and a willingness by management to take the difficult decisions either to retire medically or dismiss staff on the ground of medical inefficiency where they are unable to give regular and effective service. In nine out of the 10 prisons with the   highest levels of sickness absence as identified in the PAC's report, there has been an average reduction in sickness absence of 36 per cent. since 2002–03.

Edward Leigh: In those statistics, the Minister did not mention that the Prison Service still has the highest sickness absence in the civil service, that sickness absence in the 10 worst offending prisons has fallen only from 22 days to 15 days a year, or that, astonishingly, prison officers in two prisons are taking one in every five weeks off sick. What real progress is she intending to make to get on top of that appalling problem and manage our prisons properly?

Fiona Mactaggart: The hon. Gentleman is right to say that sickness absence is a serious problem. When his Committee produced its helpful report identifying that there was a serious problem, the difference between the average amount of sickness absence in public sector and private sector prisons was about seven days. It is now below one day. We have reduced the number of days taken as absence in each of the 10 prisons identified in the report by more than seven days. Yes, there is still a problem, but we are working to overcome it in exactly the way that his report identified by setting clear milestones, by using clear management action and by bearing down on those prisons where the problem is greatest. We are making a difference; we still have more to do.

Ancestral Visas

Richard Benyon: If he will make a statement on the future of ancestral visas.

Andy Burnham: Our consultation on a new points-based system for managed migration to cover routes to work, study and train in the United Kingdom closes today. As we develop the new system, we will consider how it relates to existing routes such as UK ancestry and we will assess the possible impact before making any changes.

Richard Benyon: Earlier, when the Minister was talking about asylum entry to this country, he referred to an unacceptable state of limbo, which he is seeking to exclude from the process. Will he consider the unacceptable state of limbo of constituents of mine such as Reg Stephens—there are many thousands like him—who came to this country from Zimbabwe down an entirely accepted route of entry, but has been unable to   access travel documents to go back to Zimbabwe to bury a relative and really needs the system sorting out? Will the Minister assure me that he will address that as a matter of urgency because many people are suffering under the current alleged review?

Andy Burnham: I am aware of the case, which the hon. Gentleman has raised assiduously with the Department. We all want to ensure that there is no abuse of our   managed migration system. A review of the system carried out a couple of years ago revealed that there was some abuse of the managed migration route into the UK. I am sure that the hon. Gentleman will respect the   fact that investigations had to be carried out to ensure that the procedures for ancestral visas are robust. That work has been carried out and we hope that we will soon be able to reconsider applications such as that of his constituent.

Humberside Police

Diana Johnson: If he will make a statement on the performance of Humberside Police.

Hazel Blears: The performance assessments published by the Home Office and Her Majesty's inspectorate of constabulary on 27 October show that in   2004–05 Humberside police made significant improvements in crime reduction and reduced overall crime by 12 per cent., one of the largest reductions by any force last year. Although the force continues to face challenges on a number of fronts, its performance continues to show overall improvement.

Diana Johnson: Under the previous chief constable, Humberside police force was the last police force in the UK to get police community support officers, who carry out a valuable role in dealing with crime and antisocial behaviour. Does my right hon. Friend agree that forces that have been able to innovate and embrace change have done much better than those that have lagged behind?

Hazel Blears: Yes, I entirely agree. I am delighted to say that Humberside has its first tranche of community support officers. My hon. Friend will know that we have plans to get 24,000 community support officers over the next three years, and I have no doubt that Humberside will bid for some of them. The excellent job that they are doing in the rest of the country will help to reassure her constituents.

Court Martial Judgment

Michael Ancram: To ask the Secretary of State for Defence if he will make a statement on the collapse of the court martial of seven paratroopers from the 3rd Battalion the Parachute Regiment, accused of murdering an Iraqi civilian two years ago.

Adam Ingram: I want to make it clear from the outset that the armed forces operate to the very highest standards. All personnel are aware of the necessity to operate within the law. It remains MOD policy to initiate a service police investigation into every instance where the action of British service personnel may have led directly to the death or injury of Iraqi civilians. The Government back our troops fully. I, together with the chiefs of staff, am very proud of the role that British armed forces play in the world. They do an exceptional job in very difficult circumstances and operate to the very highest standards.
	The trial of the seven members and former members of the 3rd Battalion the Parachute Regiment concluded on 3 November in Colchester, after the Judge Advocate General directed the board to find all seven defendants not guilty. The trial related to an incident in Iraq which occurred at the roadside in Maysan province in southern Iraq on 11 May 2003, following which Mr. Nadhem Abdullah, an Iraqi citizen, died. The seven individuals were jointly charged with murder and violent disorder.
	I am limited as to what I can say about the Judge Advocate General's decision, as this is a matter for my noble and learned Friend the Attorney-General. However, it may be helpful if I place the trial in its operational context.The end of the trial has raised the question of why the soldiers faced those serious charges. Soldiers understand that they are required to operate within the law and their rules of engagement and can be held to account for their actions. All soldiers in Iraq and elsewhere receive a briefing on that. They also receive training in the law of armed conflict as part of their annual training. Soldiers are not above the law.
	Whenever an incident occurs or an allegation is made,   a Royal Military Police—RMP—investigation is launched by the commanding officer. The conduct and   scope of such investigations is determined independently of the chain of command. The RMP   special investigation branch—SIB—is a fully professional investigative agency, which conforms to UK Home Office standards, where appropriate, and follows civilian police investigative procedures. Investigations are carried out thoroughly, professionally and in accordance with the rules of evidence, UK best practice and the Association of Chief Police Officers standards, but operational circumstances or cultural differences may limit the forensic and investigative opportunities.
	In this case, the Royal Military Police was operating in a hostile and volatile environment, which clearly impacted on some aspects of its investigation, both in terms of its scope and its timing. The decision to prosecute was taken by the Army prosecuting authority based upon the evidence gathered by the RMP. The APA acts as prosecutor in all courts martial and has a similar role to that of the Crown Prosecution Service in civilian courts. The APA is statutorily independent of the Army chain of command, which has no influence over its case management or decision-making process. The decision to prosecute is based upon its assessment of the evidence and of the realistic prospects of a conviction.
	Everyone is presumed innocent unless and until they   are found guilty. The four servicemen and three ex-servicemen were provided with every assistance to enable them to put their case: a unit defending officer was provided for each of them and acted as their link with their defence team; they were each defended by a QC, funded by the Army criminal legal aid authority; and they were all afforded full welfare provision throughout the period up to and including the trial—and this continues.
	The Judge Advocate General made it clear that he had no criticism of the Army prosecuting authority in   bringing the case to trial. This court martial demonstrates the Army's commitment to transparency and accountability. It was held in open court, where it was open to full public scrutiny, and to the same standards of justice and independence that are present in the civilian justice system. All the parties and authorities involved, military and civilian, acted properly and in good faith.
	The British Army is not complacent. Following all operational commitments, a process of continuous and determined professional review is undertaken. The comments of the Judge Advocate General are being considered and a comprehensive review of the 3 Para trial is under way. In addition, the Army announced a review following the trial earlier this year of members of 1 Royal Regiment of Fusiliers. The review is being conducted on behalf of the Chief of the General Staff by a senior experienced officer and is looking at issues arising from concluded courts martial relating to deliberate acts of abuse. It will seek to learn lessons and look at wider issues emerging from trials and other reports, in order to safeguard and improve the Army's operational effectiveness. Any findings can be published only after all the courts martial have concluded, so publication is therefore likely to be some time in the future.
	This case has shown our determination to ensure that justice is done irrespective of the difficulties. We are very sensitive to the ordeal that these soldiers have been through—they have acted with dignity throughout and I hope that they will now be given respect and privacy to enable them to continue with their lives. More than 80,000 servicemen and women have served in Iraq—only a very small number of them have been accused of ill treatment of Iraqi civilians, and a number of those have already been cleared of any wrongdoing, as in this case. Our troops in Iraq continue to perform outstandingly, but they are not above the law.

Michael Ancram: I thank the Minister for that reply. I   understand that this is not an easy subject for him and that many of its aspects do not fall directly within his area of responsibility, but he is the Minister with responsibility for the armed forces, and he is responsible for their morale. He, like me, pays frequent and heartfelt tribute to our armed forces—he has done so again today, and I join him in doing so. Indeed, it is for that reason that I have put down this question because, as he knows, the prosecution of those seven soldiers had a serious effect on morale, and the collapse of the prosecutions has created even greater uncertainty and doubts in the mind of our armed forces.
	Of course, where a crime has been committed and the evidence substantiates it, it must be prosecuted, but that   was clearly not the case here. In his decision to stop the cases, the Judge Advocate General described the investigation of the case as "inadequate" and much of the evidence as "inherently weak or vague". He referred to witnesses having
	"colluded to exaggerate and lie",
	and he referred to witnesses seeking "blood money". The bringing of this case therefore raises some serious questions. Who decided that these prosecutions should proceed? Was the Attorney-General involved in that decision? Was a political overview sought and was one given? Who was paying for the witnesses and who decided what they should be paid and for what?
	We need urgent answers to those questions. They also form part of a wider concern about the serious damage to morale arising from doubtless well-intentioned but ultimately unsubstantiated prosecutions such as these and that against Trooper Williams, which also collapsed earlier this year. We must never forget that our forces are operating in a highly dangerous and hostile environment where confidence is essential and where nearly 100 of our soldiers have lost their lives. They cannot operate effectively with the spectre of the lawyer metaphorically looking over their shoulder.
	Does the Minister agree that such prosecutions are highly damaging to recruitment and retention, both of which are under severe pressure? Does he also agree that they highlight a failure of his Department's duty of care towards service personnel? In that regard, can he throw   some light on a report in yesterday's edition of The Observer that the Secretary of State will this week unveil a so-called action plan to offer support and counselling to those facing such prosecutions? Will he undertake to initiate a full review of how such prosecutions are undertaken?
	Does the Minister agree that such prosecutions undermine the whole concept of mission command upon which the British Army operates? Does he share my sympathy for the view expressed in another place by Lord Boyce, the most recently retired Chief of the Defence Staff? He said that
	"The Armed Forces are under legal siege".—[Official Report, House of Lords, 14 July 2005; Vol. 673, c. 1236.]
	He went on to say that they are being pushed in a direction where necessary operational military orders could be deemed improper or legally unsound. The battlefield is not a court of law and actions often have to be taken spontaneously. Is it not vital that in the proper pursuit of justice we must never compromise the ability of our armed forces to fight and to win?

Adam Ingram: I appreciate what the right hon. and learned Gentleman said at the outset about the role that   is played by Members across the Chamber in highlighting not only the difficulties that personnel face in conflict or in dealing with the aftermath of conflict, no matter where they may be, but the way in which they carry out their duties. I am sure that that view is shared throughout the House.
	I hope that the right hon. and learned Gentleman, who served as a Northern Ireland Minister at a time when members of Her Majesty's armed forces and the security services were brought to trial for actions that were carried out, is not arguing that we should simply turn a blind eye to wrongdoing. [Interruption.] Well, we have established that; it is important to do so. I do not know whether he is then arguing that we should have ministerial oversight of the judicial process. That was not the case in the past, it is not the case now, and it would not be advisable for it to be the case in the future.
	All judicial processes have to be wholly independent, and those circumstances applied in this case. I recognise the way in which it has played out. Great publicity was given to it and it was sometimes exploited by those commenting on it, perhaps for political purposes, on both sides of the debate—those who want to oppose the Government per se and those who want to oppose what the Government are doing in Iraq overall. That does not help in the judicial process, which must be wholly independent and, in the right sense of the word, calculating in terms of all the evidence that is before it. The Judge Advocate General determined that there was true justification for bringing this case to trial and sufficient material evidence so to do. He also recognised the very difficult circumstances in which the SIB carried out its investigations, although he went on to comment on what he perceived to be the failings in those investigations that ultimately led to the collapse of the case.
	As I said, the whole matter will be subject to a thorough review. We review every incident of such a   serious nature. As MOD Ministers we—and equally importantly, if not more so, the chiefs of staff who have the responsibility alongside us to maintain high morale—must ensure that any lessons that need to be learned will be learned. I give the right hon. and learned Gentleman that commitment. As I said in my opening statement, that review is under way. We have said that consistently and, as we take each lesson on board and determine what we must do, a suitable report will be made in some shape or form to the House.
	The right hon. and learned Gentleman asked about the payment of witnesses. There is nothing unusual about witnesses receiving expenses and that applied in the case that we are considering. We must now examine whether the level was appropriate and what can be construed from that. The military court service made the decision and it, too, is currently reviewing its processes.
	I hope that the right hon. and learned Gentleman and Conservative Members who have supported us in the conflict recognise that, as in any theatre of conflict, there is a fine line to walk. We must ensure that we maintain the confidence of the people whom we are trying to help while ensuring that our troops receive adequate and proper resources to carry out their job. Some of the comments that are made off side do not help morale because they undermine the difficult task that our soldiers face. They know that they have to conform to the rule of law and those who misunderstand and misdirect comments do not help in boosting morale.

Gordon Prentice: The right hon.   and learned Member for Devizes (Mr. Ancram) mentioned Trooper Williams, who is a constituent of mine. All charges against him were dropped. I asked the Attorney-General on 2 March about those matters and I was told that the role of the military prosecuting authorities is subject to the general superintendence of   the Attorney-General. I was further told that the Attorney-General would not reassess his role. In the light of the judgment and what has emerged, may I take it that the Minister will press the Attorney-General to review his role?

Adam Ingram: I do not think that my hon. Friend has made a case for that. The collapse of a trial or the fact that it does not proceed to conviction does not mean that the Attorney-General's supervisory role is wrong per se. That happens in civilian life, too, but does not mean that the Attorney-General should not be involved in due process. I am not a lawyer, but I believe that it is right that the highest judicial authority in the land examines such matters if required because that places a protection in the system of proper legal assessment of all aspects that are presented. I know that that supervisory role is undertaken with the highest probity and independence. I hope that that is so ever more.

Michael Moore: I join the Minister and the shadow Secretary of State for Defence in paying tribute to our armed forces in the dangerous places where they operate—Iraq, Afghanistan and many other parts of the world. I also agree with the Minister's comments about the dangers of ministerial oversight of judicial process.
	Serious military justice issues arise from the case. I hope that we will consider them in the Armed Forces Bill in due course. It is surely a fundamental principle in our country that, as the Minister said, our armed forces must never be above the law. However, is not the quid pro quo that any prosecution should be brought only on evidence gathered from proper forensics, timely witness statements and, in a murder case, some basic evidence that would allow a post mortem? The Judge Advocate General was scathing in his opinion of the investigation that the Royal Military Police conducted. Surely the lack of resources available to the investigation team was the basic problem. For that, Ministers should be held fully accountable.

Adam Ingram: I thank the hon. Gentleman for his opening comments. He is right that some of the issues will need further examination and scrutiny in the Armed Forces Bill and I hope that all Members who participate in the proceedings will do so with a genuinely open mind to find the best legal framework in which our armed forces can continue to operate.
	The hon. Gentleman appeared to have reached a conclusion—I wish that I had his capacity.—[Interruption.] He has not got hindsight but foresight in one sense. I said that a range of issues would be subject to thorough review. We cannot reach a conclusion about them until all outstanding matters are tackled. There are two other directed cases and two awaiting direction. That process has to be gone through, and it would be wrong to say at this early stage that we have come to a conclusion. If a subsequent trial finds something new or different, we shall have to examine that. This is going to be a thoughtful and detailed process. However, where we can identify specific issues about which there is no real debate, of course we shall seek to act.
	The whole question of resources is one that we have to look at, at any point in time. We need to ask whether there is a sufficiency of numbers, for example, and whether the environment is appropriate for the troops to carry out their activities. We then have to walk a very fine line. I can envisage the hon. Gentleman saying that there should be an investigation, perhaps even a prosecution, but he must take into account the difficulties involved. No matter what resources we put into that theatre, there could still be an extreme risk when carrying out such an investigation. It so happens that, in this trial, a view was taken that those involved in hearing the trial should visit the scene. However, it was   judged to be too dangerous for them to do so. It could also be too dangerous in many circumstances for   the Royal Military Police to carry out further investigations. This would not be for a lack of trying, or for a lack of resources, but because circumstances might just dictate that it was impossible. I hope that the hon. Gentleman understands that.

Brian Jenkins: If I may, I wish to put this proposition to my right hon. Friend as honestly and sincerely as possible. I accept that our soldiers have to operate under the rule of law—that is what makes them different from the people they are fighting against—and we must ensure that any trial or action abroad is totally independent. We must make that as clear as possible, so as to dismiss any allegations that political pressure has been brought to bear to ensure that this trial took place. We must be seen to be operating according to the letter of the law, to win friends in places such as Iraq. Will my right hon. Friend give the House an assurance that there was no political involvement in, and no political pressure brought to bear on, these cases?

Adam Ingram: I know that my hon. Friend is a very good friend of Her Majesty's armed forces, and I always listen with interest to what he says on these matters. I   can give him an absolute guarantee, as I tried to do in my opening response, that there was no political interference in this matter—nor should there be. It would be wholly damaging if we were acting on one side of the debate. It could damage the independence of the judicial process or the morale of the troops if things were going the other way. We have been completely hands off. The Army prosecuting authority is wholly independent, as are the investigation processes. Some of   the nuances involved, such as the role of the commanding officer, will of course be considered during the process of the Armed Forces Bill. I am sure that my hon. Friend will make valuable contributions during that process and help us to achieve a corpus of legislation that will help the armed forces for many decades to come.

James Arbuthnot: One of the many problems with this is, as my right hon. and learned Friend the Member for Devizes (Mr. Ancram) has said, the possible knock-on effect on recruitment and retention. Will the Minister confirm that only a tiny, tiny minority of our armed forces are ever accused, let alone found guilty, of wrong doing, and that when young men and women decide to take up a career in the armed forces, they carry with them the pride and the reputation of this country and the thanks of this House?

Adam Ingram: The right hon. Gentleman makes a valuable and important point. The answer to his question is yes, only a very small number is involved. As I have said, two more cases have been directed and two await direction, so we shall have more of this debate. The men and women, many of whom are very young, who join the armed forces are joining a highly professional, highly capable organisation, which seeks to deliver the good face of this country. They are a force for good. As in any part of our society, when people step over the line and do wrong they must be brought to justice. That applies to the armed forces as much as to   anyone else. However, given that more than 80,000 of our armed forces have served in Iraq, and only a very small number have been accused never mind found guilty of wrongdoing, that speaks volumes for their quality. Clearly, that should encourage more young people to consider the armed forces as a career.

Bob Russell: Will the Minister put on the record that the seven serving and former members of the 3rd Battalion the Parachute Regiment left that court martial without a stain on their character? Can I advise him that the relief across the Colchester garrison and the wider community is matched only by the disbelief that the trial happened in the first place? Many figures have been mentioned, but can he indicate how much the whole saga cost?

Adam Ingram: On the cost issue, the hon. Gentleman will be aware that when dealing with QCs the cash register keeps running for some time afterwards, so the total cost is not available. It was very sizeable, however, given that each individual had a QC and all the support arrangements that applied. When any of our people are subjected to the rule of law in terms of court action, we are determined that they should be given full support. In addition, although I cannot give him a precise answer, we probably do not count in all the welfare support and man hours that contribute to providing that type of support to our people, who, we recognise, can be very fragile in such circumstances.
	As to the disbelief in the Colchester garrison or perhaps across the Army and armed forces, I do not take that view. Certainly, because the trial collapsed, the question has been asked: why did it happen in the first place? The hon. Gentleman can assist his constituents and their families by reading the transcript of what the Judge Advocate General said, understanding that, and then answering his own first question.

Robert Key: My right hon. and learned Friend the Member for Devizes (Mr. Ancram) and I represent thousands of service families in Wiltshire. We know the enormous strain put on the families of our servicemen and women overseas. Will he consider the financing of the Army welfare services and   the Army Families Federation, both of which do an enormous amount to assist the families of those involved, and both of which are constantly under financial pressure?

Adam Ingram: The answer to that must be yes—we must consider that all the time, given the intensity and tempo of attitudes and views about the pressure on our people. We cannot chase the last headline, however—the hon. Gentleman is more sensible than to do so, and I wish that others were as balanced—because if we do that, we do not necessarily fix the problem. We must consider shortfalls and shortcomings in the round and examine where our duty of care mechanisms for our people can be strengthened. We are always on that case and many things happen within the system, sometimes without even ministerial oversight and approval, simply because they are required to be done. The matter is always under review.

Ben Wallace: The hon. Member for Pendle (Mr. Prentice) raised earlier the   trial of Trooper Williams, which collapsed in similar circumstances. That case was brought to trial only after the Army Board, of which the Minister is a member, referred it to the Attorney-General—one of the rare occasions on which that has happened. Can the Minister confirm that the case of these members of the   Parachute Regiment was not referred from the Army Board to the Attorney-General, and that it was purely the decision of the commanding officer to bring these men to trial, and not of people further up the chain or, indeed, the Army Board of which he is a member?

Adam Ingram: The hon. Gentleman is right about one thing—that I am a member of the Army Board—but he is wrong about everything else.

Ben Wallace: On a point of order, Mr. Speaker.

Mr. Speaker: Order. I can take a point of order only after questions have finished, but I can tell the hon. Gentleman before we go any further that the quality of replies is nothing to do with me.

Nicholas Winterton: As one of   the very small band of Members in all parts of the House who served with Her Majesty's armed forces—admittedly in non-hostile, non-war circumstances—may I say that I consider the prosecution to have been totally unnecessary and totally unacceptable? Is the Minister aware that members of our armed forces, unlike politicians, put their lives on the line? If it is believed that they have done anything seriously wrong, should there not be unimpeachable evidence that they have done so before a prosecution is brought? I believe that we are treating our armed forces—not only in Iraq but in Northern Ireland, those who serve and those who have retired—in a grotesque and unacceptable way.

Adam Ingram: Let me calm it down a wee bit. The hon. Gentleman says that he has military experience, but I   think I am right in saying that he has never had any ministerial experience. I conclude from his comments that had he been a Minister on this occasion, he would have interfered in the due process of law. That is not the standard that applies in this country, and I do not think Conservative Front Benchers are saying the same, although some of them have been through it.—[Interruption.] The Attorney-General will answer for himself. His is the highest opinion that can be sought.
	The Army prosecuting authority is dealing with some heavyweight issues, which has excited the hon. Member for Macclesfield (Sir Nicholas Winterton). It is right that it should have done so, but he has been led to the wrong conclusions. I think it appropriate for that independent authority to take the case to the Attorney-General, who   is a ministerial superintendent of the APA. Independence is involved in that process. If the hon. Gentleman is saying that it is not involved, he will have to prove his case. The system has stood the test of time. It is still valid today, and I think that it will stand the test of time in the future.

Keith Simpson: Anyone who had listened to the Minister, my right hon. and learned Friend the Member for Devizes (Mr. Ancram) and the other Members who have asked questions would probably say that the Minister and the Government have now achieved the worst of all possible positions. It may be only a minority, but a minority of public opinion suspects that the process is not open enough, not transparent enough and not independent. At the same time, members of the armed forces undoubtedly feel that they will be tried twice, once by a military system and once by a normal civil system. I   know that the Minister is responsible only for the defence side, but may I say to him that the Government, including the Attorney-General, need to examine the   whole system? As I have said, at present they are in the worst possible position, and I believe that that undermines the morale of our troops.

Adam Ingram: I am grateful to the hon. Gentleman for the lecture. I am sure that the personnel of our forces would benefit from a few lectures.

John Bercow: My hon. Friend was a tutor at staff college.

Adam Ingram: I am pleased that the hon. Gentleman understands the point. It shows that he is awake.
	I think that we have an open and transparent system.—[Interruption.] I am going to give an answer to the hon. Member for Mid-Norfolk (Mr. Simpson). I am just trying to take some heat out of this.
	As I said, I believe that the system is open and transparent. If we did not have an open and transparent system, we probably would not have heard some of the very good questions that we have all been asked today. That shows that people understand a large part of the process, which is conducted openly. We have an independent prosecuting system and an independent judiciary. Some issues involving the relationship between all those elements will have to be dealt with by the armed forces Bill, and I know that the hon. Gentleman will make a valuable contribution to the debate.

Richard Benyon: I am sure that the Minister will take a serious and genuine look at why the prosecution was brought, but does he understand that there is a wider danger, which was articulated in some of the Sunday papers and which has given many of us who served in Northern Ireland cause for great concern? Does he understand the wider effect of that and the need for joined-up government? Will he exclude here in the House the implied threat in those articles that there will be a tribunal to look into cases where suspect terrorists were shot by members of the armed forces in Northern Ireland? Does he understand that that will damage recruitment, as my hon. Friends have said, which must be taken into account?

Adam Ingram: If wrong-doing has occurred, I am sure that the hon. Gentleman is not saying that we should simply ignore it. [Interruption.] Members indicate dissent, but I am asking the hon. Gentleman whether, as an ex-soldier, he understands what he was taught and the rule of law that he had to apply. He knew that if he stepped over that line he could be subject to investigation. Clearly, as with any other criminal action, if that is indeed what it was, such an investigation could be subject to retrospective review. At any point, if new evidence arises it is right that it is examined.
	I am not going to comment on speculation in the press. That will be debated when we deal with some of the ongoing difficult issues we have had to face day upon day, month upon month in moving forward the peace process in Northern Ireland. I pay tribute to the hon. Gentleman because he, as a serving soldier, helped to bring about that peace by applying the highest standards of integrity, probity and—[Interruption.]

Mr. Speaker: Order. You must be careful, Mr.   Howarth. The Opposition came to me and asked for an urgent question, and I requested that the Minister come to the House. I must give the Minister protection. No one should be shouting at him while he is speaking.

Henry Bellingham: The Minister mentioned the supervisory overseeing role of the Attorney-General. Presumably, the Attorney-General had a look at all the evidence, or an outline of the evidence, which the Minister has admitted was completely flawed. The whole case has been a fiasco. Can the right hon. Gentleman imagine this happening in countries such as France or Spain? Should not the Attorney-General now explain himself?

Adam Ingram: I am sure he will, but not in this House—not at the present time. I quote from Judge Blackett's findings:
	"I make no criticism of the prosecution or the Army Prosecuting Authority, even though I have directed verdicts of not guilty at this stage. Where on the face of the papers presented by the investigator a serious crime appears to have been committed it is perfectly proper to take the matter to trial, and in this case the prosecution team have presented their case properly and objectively."
	The hon. Gentleman may have a different view from the Judge Advocate General, but I think that that is quite a weighty conclusion.

Orders of the Day
	 — 
	Council Tax (New Valuation Lists for England) Bill

Order for Second Reading read.

Mr. Speaker: I should inform the House that I have selected the reasoned amendment in the name of the Leader of the Opposition.

David Miliband: I beg to move, That the Bill be now read a Second time.
	This short two-clause Bill is brought before the House as the legislative consequence of the Government's decision to extend the remit of Sir Michael Lyons' independent inquiry into local government funding, and the decision that followed to postpone the 2007 council tax revaluation in England.

John Bercow: Eat it more slowly.

David Miliband: We will come to that a bit later.
	Local government is at the heart of national life and has a unique role in our communities. It plays a crucial role in delivering services, leading and co-ordinating the activities of local public, private and voluntary organisations, and making villages, towns and cities more prosperous and pleasant to live in. I pay tribute to   councillors of all parties and to hard-working public   servants for the way in which they have raised   standards, so that the Audit Commission's comprehensive performance assessment now classifies two thirds of upper tier authorities as either "excellent" or "good".
	Important changes are under way in local government. Local authorities are leading new children's trusts across the country that are bringing together social services, education, health and other services. Local area agreements enable councils and central Government to recognise and to agree local priorities, to rationalise funding streams and to support greater local leadership.
	Our manifesto set out an ambitious programme of   further public sector reform, continuing the improvement in neighbourhood services to make them more responsive to the needs of people who use them. Since 1997, there has been a 33 per cent. real terms increase in grants to local government. Investment and reform have gone together and have delivered.

Patrick McLoughlin: We often hear from the Government about the huge increase given from the centre to local government. If that is the case, why has council tax gone up by so much? That is what people want to know.

David Miliband: I can give a number of clues. First, council taxes are set locally by local government. Secondly, local government has an extremely ambitious agenda that it is delivering. Thirdly, the one thing that   certainly would push up council tax is if local government funding were cut as the Conservative party proposed at the last election. That would certainly drive up council tax—by our calculations, by about 11 per cent.

John Bercow: rose—

John Redwood: rose—

David Miliband: I have an embarrassment of riches, but I think that I will choose the future rather than the past.

John Bercow: Obviously the Minister must make a finely balanced judgment between the fiscal position on the one hand and the risk of political flak on the other. He has made his choice and will do his best to justify it today. But in the circumstances, given the plug that has to be gapped, what assessment has he made of the effect of the change in the rules on the use of capital allowances from the sale of council houses on the size of interest repayments on local authority debt?

David Miliband: I am a genuine admirer of the hon. Gentleman's ability to command the attention of the House, but when he talks about gapping plugs rather than plugging gaps he really does have us on the edge of   our seats. He will join me in saying that the Government's decision to ensure that the proceeds of the social homebuyers scheme are returned to local authorities to help them build should be supported by all hon. Members. It would only be polite if I allowed the right hon. Member for Wokingham (Mr. Redwood) to intervene.

John Redwood: The Minister is courteous in the end and I am grateful to him. What was his reaction to the weekend's press stories that if someone has taken the   trouble to do up their home, put in extra facilities and paint the front door a decent colour, they will be socked in the teeth by the Government with a higher valuation?

David Miliband: I suggest that the right hon. Gentleman spend more time reading the Bill than the Sunday papers, because the Bill is designed to ensure that that does not happen. I am surprised to get such a lesson from the right hon. Gentleman, who, as the great believer in the market, should be arguing that a property-based taxation system should reflect the market value of properties. If he does not take that position, we can have an interesting debate on the role of markets in public life.
	We believe that the changes that I have set out represent not only a big challenge but a massive opportunity for local government and we believe that opportunity is most likely to be grasped if local government is able to focus on service delivery supported by financial stability. This is the context for the changes we are debating today.
	The Opposition gave the Under-Secretary, my hon. Friend the Member for Poplar and Canning Town (Jim   Fitzpatrick), the chance to set out our arguments and explain the Lyons inquiry in our recent debate on 19 October. The Government appointed Sir Michael Lyons in July 2004 to carry out an independent inquiry into local government funding. He has made good progress with that remit and, over the summer, discussed with Ministers his view that robust recommendations on possible reforms to local government funding could not be made in isolation from proper consideration and understanding of the changing role of local government.
	It is in that context, and for that reason, that my right hon. Friends the Chancellor of the Exchequer and the Deputy Prime Minister extended the terms of reference of Sir Michael's inquiry to consider and review the changing role of local government and to review how   the Government's agenda for devolution and decentralisation could improve services, and, in the light of this, to consider how to manage pressures on local services. That was in addition to his existing remit to make proposals on the funding of local government.

David Curry: Will the Minister confirm that Sir Michael Lyons said that a delay of one year in revaluation was justified, but not longer?

David Miliband: I did not hear all of the right hon. Gentleman's question, but if he said that while Sir   Michael Lyons was willing to countenance up to a year's delay in revaluation but did not propose the postponement that we are proposing today, he is absolutely right; I do not seek to hide our decision behind the recommendation of Sir Michael Lyons.
	As I said when I announced our decision on 20 September, we need a clear and complete picture of what we want local government to do before we tackle how it will be funded. In short, we must settle function before funding. As I also said on 20 September, later this autumn Sir Michael will set out his preliminary thinking, drawing out the relationship of local government function to finance. He will publish a series of reports next year in the lead up to his final report at the end of 2006.

Andrew Turner: Can the right hon. Gentleman, who is a former Education Minister, tell me whether the recent White Paper adds to, or reduces, the responsibilities of local government?

David Miliband: As the hon. Gentleman and I have discussed before, the White Paper provides for a changed role for local government that builds on the existing strength of its relationship with schools. If, like me, he had been in Sheffield last week talking to the local authority, he would know that it does not see itself running schools. It is for head teachers and governing bodies to run schools, but the role of local authorities is to step in and to promote reform and development, which is what the best local authorities throughout the country are doing.

John Bercow: Will the right hon. Gentleman give way?

David Miliband: The temptation is too great.

John Bercow: I am very grateful to the right hon. Gentleman for generously giving way again. It really is the merest casuistry to answer my hon. Friend the Member for Isle of Wight (Mr. Turner) in those terms. I rather suspect, even though I have not spoken to my hon. Friend on this subject, that he was not looking for an essay-question response or for an evaluative answer from the right hon. Gentleman. What he really wants to know is whether the right hon. Gentleman thinks that, as a consequence of the White Paper, bills will go up overall and more money will therefore be required, or that they will go down, with the logical corollary that that involves.

David Miliband: Tempting as it is to be the tutee of the hon. Gentleman, council tax bills is precisely not what the hon. Member for Isle of Wight (Mr. Turner) was asking about. If the hon. Member for Buckingham (John Bercow) had read the White Paper, he would know that it makes it absolutely clear that it imposes no new burdens on local government. The hon. Member for Isle of Wight was actually probing our view of the role of local government in national life, and specifically in respect of education.

Andrew Turner: rose—

David Miliband: If I may, I shall proceed. We are here to discuss the postponement of revaluation and, tempting though it is to discuss education policy, perhaps we can stick to local government finance.

Paul Beresford: Does the Minister agree that this Bill effectively puts revaluation in limbo, and that there might be no revaluation in future if there is a rethink on the grant formula, depending on the Government's reaction to Sir Michael Lyons' comments?

David Miliband: By definition, if we are not taking a decision now to revalue but are keeping our options open, all options remain open in future. But we have made it clear that we think it right to keep property tax as the basis of local taxation, to invite Sir Michael Lyons to complete his review, and to assess the role of a revalued council tax in that context.
	As the House knows, at the same time as we announced the extension of Sir Michael's remit, we   announced that we intended to legislate to postpone council tax revaluation. As our announcement explained, the case for revaluation—that it is right to maintain a fair alignment between house prices and council tax bands—is linked to wider questions about the structure of council tax and to the operation of council tax benefit. It is also relevant that a number of   other changes in the local government finance system are imminent, including the move to three-year budgets, the review of the local government finance formula, and the creation of a dedicated schools budget located in the Department for Education and Skills.
	We have reached the view, therefore, that to proceed with the current timetable for revaluation would not be sensible. We have concluded that we need the flexibility to revalue as part of a fully developed package of funding reforms, rather than as a precursor to them, and at a moment of greater financial stability for local authorities.

Eric Pickles: The right hon. Gentleman is being extremely generous in giving way. All the things that he has just announced were known when the Government decided to move towards revaluation. They have spent £60 million on it,   of which £45 million was spent on software alone. Is anyone in the Valuation Office Agency working on revaluation, and how long will the purchased software remain relevant, before becoming obsolete?

David Miliband: I am afraid that I cannot allow the hon. Gentleman's assertion to remain on the record unchallenged. To take one obvious example, the creation of the dedicated schools budget was not known in 2003; it was a subsequent decision, so his assertion simply is not right. I shall deal with the Valuation Office Agency in a moment, if he will allow me. The software is state of the art and will be an efficient and effective replacement for the 22 million files that existed until now. The digitisation of that data forms the basis of effective government.
	We reached the view that to proceed with the current timetable would not be sensible and we concluded, as I   was saying, that we needed the flexibility to revalue as part of a fully developed package of reforms.

Mark Harper: Ministers announced that the Lyons report would be published at the end of 2006. In view of that, has the Minister decided when the Government will have considered that report and when the Government will announce their resultant policy?

David Miliband: I think that the hon. Gentleman may be referring to the statement of 20 September, which was repeated before the House on 10 October. If he read on, he would see that we expect the Government to come forward with their views during the completion of the comprehensive spending review in the summer of 2007. As I said, that was made clear on 20 September.
	Although this is a short Bill, it may help the House if I   explain its effects. First, it removes the requirement laid down by the Local Government Finance Act 1992 for the compilation of new lists on 1 April 2007. Clause 1(3) amends section 22B of the 1992 Act by removing the duty on the listing agency—in practice, that means the Valuation Office Agency—to compile a new valuation list to billing authorities in England on 1 April 2007 and a draft of that list to be completed by 1 September next year. We have already informed the   House that the VOA has stopped work on the revaluation of domestic properties in England to prevent nugatory expenditure—and the provision formalises that position.
	Secondly, subsection (4) removes the requirement for subsequent revaluations on the 10th anniversary of the previous one, unless an earlier date has been specified by   order. Until the Government have received and considered Sir Michael Lyons' final report, we cannot take a view on how frequently revaluation should occur and we therefore think it right that we should not be   statutorily committed to revaluing on a rigid, predetermined cycle.

Nick Raynsford: I hear my right hon. Friend's argument for postponement—I do not agree with it—but I do not understand the argument for deleting the provision for a 10-yearly cycle for revaluation. That was the subject of Government consultation in 1999–2000 and was the subject of a White Paper, which set out a commitment to a 10-year revaluation. As far as I know, Sir Michael Lyons has not been asked to comment on whether that revaluation cycle should change. I simply do not understand the Minister's logic for cancelling a provision for regulation revaluations.

John Bercow: And he is your friend!

David Miliband: My right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford) is, indeed, my very good friend and he speaks with a great deal of authority on these matters. He will know more than anyone else that at the time of the 2002 Bill there was a great deal of discussion about   the requisite period. As it happens, and ironically in the   current context, the Conservative spokesman in the   other place wanted to reduce from 10 to five years, the—[Interruption.] The hon. Member for Meriden (Mrs.   Spelman) is shouting from a sedentary position. We are all disappointed that she is not speaking today and that she has left the task to others; she may be winding up the debate, but I do not know.
	As my right hon. Friend the Member for Greenwich and Woolwich knows, there was considerable discussion about the period and we think that it is right to keep the flexibility created by the clause.
	Finally, the Bill replaces those two provisions for revaluation, for at least 10-yearly intervals, with a power for the Secretary of State to specify the date on which a new valuation list must be compiled. Such orders will be subject to the House's affirmative resolution procedure. That was also the case in respect of the Local Government Finance Act 1992, which created the council tax in the first place. For the sake of completeness, clause 2 simply provides for the short title of the Bill and for its extent.
	I can bring the House up to date with progress at the   Valuation Office Agency, which was responsible for carrying out the revaluation. Immediately following the announcement, the VOA took steps to reduce ongoing expenditure and to reshape the agency to fit the new situation. Some 420 staff employed as casuals or on fixed term contracts will have left the agency by the 18 November. A voluntary early departure scheme has been announced, with some 600 staff expected to depart between March and June 2006. Coupled with natural wastage, the total reduction is expected to amount to some 1,250 staff.
	As we set out on 20 September, there will be significant short-term savings for the Government from   not proceeding with revaluation. However, the Government have been explicit that £45 million of the   £60 million spent so far is a prudent investment in modern and efficient working practices. The VOA will ensure that the country has an up-to-date, electronic property database, available as a source of accurate data.

David Borrow: When we have had regular revaluations of business rates, they have always been fixed for the period 1990 to 1995 and 2000 to 2005. One of the arguments for doing the revaluation of council tax in 2007 was to balance the   work of the Valuation Office Agency. Does the cancellation of the revaluation mean that if we reinstate the revaluation for council tax in the future, we shall be blocked from going anywhere near 2010 because of the implications for staffing?

David Miliband: My hon. Friend speaks as a former valuer and therefore brings his expertise to the issue. Nothing has been blocked by the Bill. The Government have made it clear that we do not anticipate revaluation occurring during this Parliament, and that is a clear statement of affairs.

Eric Pickles: The Minister says that he wants to see a modern and up-to-date database of property values. Are we to understand that the dwelling house codes and the value of significance codes are still being collected in preparation for revaluation? Or will we just have a database with nothing on it? How much will the cancellation cost in staffing terms, and will he say a little more about redundancies, early leaving and ending of contracts?

David Miliband: In respect of the first question, the hon. Gentleman had an exchange with my right hon. Friend the Member for Greenwich and Woolwich on 19 October in which they agreed that it was important to continue with the procedure under which if people move and it is apparent that the property has had a significant change in value, it is reflected in the banding. For that and other reasons, it is sensible to have an up-to-date and efficiently working system.
	In respect of the precise costs, I have made it clear to the hon. Gentleman that some 1,250 jobs will be lost as a result of the changes. The full financial effects of that are still being worked through, but as I said on 20 September significant savings are expected.

John Redwood: What was the Department's forecast for the number of grannies and granddads who would go to prison if he had not taken this action to take some of the sting out of the council tax? At what level does the number of people who think that it is an unfair tax become unsupportable?

David Miliband: The right hon. Gentleman will know, as a former Secretary of State, that the omniscience of the ODPM stretches in many directions, but not in the direction of predicting court cases.
	I wish to take a moment now to explain how the Bill will not in any way affect the approach being taken in the devolved Administrations, contrary to the assertions of some Opposition Members. In our debate on 19 October, much was said about Wales, but executive local government functions in Wales are, rightly, devolved. We have consulted the National Assembly of Wales on the subject matter of the Bill and it has indicated that it is content that it has no effect on provisions relating to Wales.
	The position in Northern Ireland is very different from that in England, not least because local government has continued to be funded through a domestic rating system instead of the council tax. The House will recall that Northern Ireland did not have the   benefit of the poll tax. The Northern Ireland Executive commissioned a review of rating policy in 2000 and that has now led to the publishing of a draft Order in Council, which is currently subject to a consultation process.

David Davies: When the Minister says that he has consulted the Welsh Assembly, does he mean that somebody has picked up the telephone and spoken to his close political colleague, Rhodri Morgan AM, or has the Minister encouraged the Assembly to discuss the matter properly? If he had done so, he would have discovered that a majority of the Assembly opposes the council tax re-banding and could vote it down.

David Miliband: I am interested in the hon. Gentleman's description of the situation in Wales. He will know that in 2001 the Welsh Assembly consulted on its proposal to implement a revaluation in 2005. All political parties and the Assembly's Local Government and Public Services Committee supported the proposal. The hon. Gentleman should bear that in mind before he makes such an intervention again.

Several hon. Members: rose—

David Miliband: I hope that the House will agree that I   have been generous in taking interventions and I now wish to proceed. I look forward to hearing hon. Members' contributions later.
	For the sake of completeness, I should also remind the   House of the position in Scotland. The Scottish Executive commissioned its own independent review of local government finance in 2004. The review committee consulted on options earlier this year and will publish its report in the summer.
	In debate with my right hon. Friend the Member for   Greenwich and Woolwich, the hon. Member for Brentwood and Ongar (Mr. Pickles) said:
	"We recognise the need periodically to revalue properties for the purpose of council tax . . . We support the revaluation being made on a regular and predictable basis."—[Official Report, 7 January 2003; Vol. 397, c. 64–5.]
	No one should accuse the hon. Gentleman of changing his mind too quickly, because two years later, he said:
	"Any council tax system inevitably requires some form of revaluation."—[Official Report, 2 February 2005; Vol. 430, c. 929.]
	A sensible man.
	The hon. Gentleman's boss, the hon. Member for Meriden (Mrs. Spelman), said that
	"a property-based tax must take account of changes in the value of the property."—[Official Report, 2 March 2005; Vol. 431, c. 983.]
	Her boss, the Leader of the Opposition—for another few days at least—said on 20 February 2005: "You have to revalue." So the Opposition support the principle of revaluation; nothing could be clearer. But in April they decided to argue for postponement. Fair enough.
	The Leader of Opposition was clear: on 20 April, he told "Sky News" that his new policy was a postponement of revaluation, not a cancellation. For the avoidance of doubt, he added "for the first Parliament", when he was questioned about the delay. So I confidently expected the Opposition to support the Bill. After all, they want to be a mature Opposition. They have been told by their young pretender to remember that actions speak louder than words. They have vowed not to oppose measures simply for the sake of opposition.
	What could be simpler than voting for a Bill to postpone revaluation? They might even have claimed that we had stolen their policy.But I had overestimated the people who go by the title of Her Majesty's official Opposition. They still take the title literally: they oppose everything. They are addicted to opposition and repulsed by common sense. No wonder that John Stuart Mill called them the stupid party—

Nick Hurd: rose—

David Miliband: The hon. Gentleman should listen to this, or he will end up going into the Lobby and doing something very silly indeed.
	What could be more stupid than an amendment claiming to denounce revaluation, but with the effect that it will go steaming ahead—for that is the effect of the amendment standing in the name of the Leader of   the Opposition? By opposing Second Reading, by declining to give the Bill a Second Reading, the Opposition want take the brakes off revaluation. The   automated valuation model, which they spent the weekend saying was such a detestation, will be whirring like there is no tomorrow if they have their way.
	The Opposition talk about supporting reform, but in the words of one of their Members, they are the roadblock to reform on this occasion. I hope that all Opposition Members realise that if they support their amendment, they will be voting for revaluation to go ahead, and we look forward to reminding them of that in the years ahead.
	Sir Michael Lyons has made it clear that any proposals for reform of the funding system raise complex issues, and the Government have agreed that they need to be set firmly and explicitly within the context of a clear, shared understanding of the role of local government and of councils' accountability to service users. It is for that reason that we have extended the terms of reference for Sir Michael's inquiry into local government funding. In turn, we decided to postpone revaluation from 2007. We have recognised that to proceed with revaluation at this time would not be the right thing to do. The Bill, therefore, puts revaluation on hold, and I commend it to the House.

Eric Pickles: I beg to move, To leave out from "That" to the end of the Question, and to add instead thereof:
	"this House declines to give a Second Reading to the Council Tax (New Valuation Lists for England) Bill because the Bill merely delays rather than cancels the council tax revaluation, applies only to England and creates inequalities with other parts of the United Kingdom; and because the removal of the need for revaluation of domestic properties offers taxpayers no protection against the imposition of new higher council tax bands."
	Were I the Minister, given the speculation in the Sunday newspapers about his position as regards the   future leadership of his party and given the Chancellor's tolerance of such matters, I do not think that I would have used the words "young pretender" in this context.
	However, on that brief note of solidarity with the right hon. Gentleman, I congratulate him, because only the last Blairite on the Government Benches could have delivered that speech with a straight face. It was nothing more than a panic attack—nothing more than the fear of wipeout at next May's elections. The Prime Minister's credibility is apparently at stake, and his credibility is so low that he fears the result that the electorate will produce in May.
	Postponement is not cancellation. I hope that I am not doing the Minister an injustice, but, frankly, to describe the reason for the postponement as a success of local area arrangements strikes me as stretching credulity. There is little doubt that the right hon. Gentleman is regarded as the Prime Minister's plenipotentiary on earth. So let us just have a touch of reality. For the convenience of the House, I have managed to collect the reaction of the specialist press to the right hon. Gentleman's announcement.
	I have here a very nice photograph of the right hon. Gentleman scratching his ear from the Local Government Chronicle, which says, "Miliband on the run. Funding reform delay as minister ducks his first tough decision." It continues:
	"The announcement was met with dismay and incredulity by many in local government, who said urgently needed reform on council tax has been sacrificed for political expediency."
	In a comment piece, which is a bit tough but nevertheless I feel that my hon. Friends may want to hear it, Kerry Lorimer, says:
	"David Miliband was in prime ministerial mode, making up in expansive gestures what he lacked in expertise . . . Five months in the job, maybe it's time for the new boy to grow up."
	That is a bit harsh, but I felt that I had to share it.

John Redwood: I wonder whether the phrase is not so much "young pretender" as "Artful Dodger". Did my hon. Friend notice how none of the good points that he and other hon. Members made were answered by the Minister today? He is obviously on the run in a very serious way.

Eric Pickles: Of course my right hon. Friend makes an excellent point, and the Minister is blushing as we speak.
	Let us move on briefly to Tony Travers—a noted expert—who said:
	"There must now be a risk the reform of local government finance becomes the object of near-permanent official inquiry. This issue would have been pushed into the longest of the long grass."
	Under a further headline, "Miliband baulks a funding decision", we read:
	"Mr. Miliband has baulked his first difficult fence as a cabinet minister."
	We have an interesting piece from the right hon. Member for Greenwich and Woolwich (Mr. Raynsford) in which he said:
	"There is no case for postponing a review of the system, which is already 14 years old. It is getting increasingly out of date."
	There is an editorial piece, "Kicked into touch again", which says:
	"Yet ministers have bottled-out of grasping the council funding nettle, and passed the buck to the next PM, presumably Gordon Brown or, judging by their date for the next revaluation . . . a Conservative."

Hugh Bayley: Will the hon. Gentleman give way?

Eric Pickles: I will give way to the hon. Gentleman as soon as I have finished giving this review of the papers, but it is coming to an artistic conclusion and we should not miss anything.
	Another headline reads, "U-turn is bad news for hopes of reform". That is too hurtful to read out in public. Under the headline, "Revaluation is a ticking timebomb", the Local Government Chronicle says:
	"exclusive survey reveals a quarter of councils, of every type and political colour, will be in the capping zone next year."
	It continues:
	"there is a limit to the pressure under which the system, already cracking, can be put—and it is now perilously close to collapse."
	Finally, a headline says, "Local government in limbo as revaluation waits for Lyons." I have had a good look through all the press—

Hugh Bayley: Will the hon. Gentleman give way?

Eric Pickles: No, no, I have not finished yet.
	The only favourable comment that I could find is in the Municipal Journal from the directly elected mayor of Lewisham, and even that was reasonably lukewarm.
	As the right hon. Gentleman has assured No. 10 that he can get revaluation away from all the problems, he cannot have been very pleased with the weekend's newspapers or this morning's or the decision by The Sun to call this new tax the patio tax.

Hugh Bayley: We are all capable of reading newspaper cuttings—in fact, I expect that most hon. Members who are attending this debate have already read through the newspapers on this topic—but will the hon. Gentleman tell the House whether he would have been happier if the Government had gone ahead with the revaluation?

Eric Pickles: No, I am not in favour of the revaluation, and I cannot imagine, given all the fuss, why the hon. Gentleman could possibly have been deluded into believing that I would. I apologise to him for reading out those pieces, but I wanted to bring home to the right hon. Gentleman that no one thinks that his method makes any sense. Those who wanted a revaluation think that the Minister is not doing a good job and so do those who did not want one. He has managed to unite the nation in believing that he has made a bad decision.
	We are not persuaded of the need for revaluation. The purpose of a revaluation is to correct grossly disproportionate movements of the housing market compared with the last revaluation, but house prices are currently converging relative to the last revaluation. As we argued when the council tax was introduced in 1992, a system of bandings means that there is no need for regular or frequent revaluations. The only reason why Labour wants to revalue and re-band the council tax is to tax the uplift in property values that has taken place since the early 1990s.
	We oppose the plans for higher taxes on hard-working families and pensioners. The revaluation has already taken place in Wales, so we will move amendments in Committee to continue the transitional relief and thus stop further tax hikes next year, after the relief is phased out.
	As the Minister has said, the Bill essentially does three things. It removes the requirement for a new valuation by 1 April 2007—we agree with that. It will take away the 10-year rule for revaluation, on which we agree with the right hon. Gentleman. Finally, it will empower the Secretary of State to determine when a revaluation should take place, with which we do not agree. As Labour Members will testify, the Library has produced an excellent brief that details the problems that have occurred because of revaluation in the past and all the problems due to the postponement of revaluation, especially. Given the nature of the council tax and the bandings, we think that the most sensible thing would be for a decision to be taken on the Floor of the House—by way of primary legislation—each time revaluation needs to takes place. That is important because such a decision should be taken not at the whim of the Secretary of State, but by Parliament.

David Borrow: Will the hon. Gentleman give way?

Eric Pickles: Of course I give way to the hon. Gentleman, who has some knowledge of the subject.

David Borrow: I am one of those Labour Members who believes in regular revaluations, so I have some worries about the cancellation of the revaluation. It would thus be logical for me to vote for the Opposition's reasoned amendment. Does the hon. Gentleman want me to vote in favour of his amendment?

Eric Pickles: I have always regarded myself as silver tongued. If I can persuade the hon. Gentleman to join me in the Lobby, perhaps we will be able to walk in arm in arm.

Alan Whitehead: Just for the avoidance of doubt, will the hon. Gentleman refer the House to section 77 of the Local Government Act 2003, which specifically states that new valuation lists should be compiled and that there should be regular   revaluations? If the reasoned amendment were accepted, that measure would be kept on the statute book. Does he think that allowing revaluation to proceed is the right course of action, or does he think something else? Perhaps it is time for a review of the process by which the Conservative party drafts its resolutions for the House.

Eric Pickles: The hon. Gentleman makes a reasonable point. There was a limited way in which we could draft a reasoned amendment because the Bill is narrow. If we had tried to draft an reasoned amendment of the type that the hon. Gentleman seems to suggest, there would have been a strong possibility that Mr. Speaker would   not have selected it for debate. It was important to us to table an reasoned amendment so that we could discuss such an important issue.
	The essential problem is this: the council tax has increased by 76 per cent. under this Government and as a direct consequence, it has become deeply unpopular. That represents a complete reversal of the public's view since Labour first came to power.

Graham Stuart: I wonder whether my hon. Friend thinks that the Prime Minister decided to postpone the revaluation because he wanted not only to protect the future career of the Artful Dodger but, more importantly, to stop the Fagin of the   Labour party, Gordon Brown, yet again using revaluation not for fiscal neutrality but as an excuse to raid the pockets of pensioners and hard-working householders across the country. That is why the Prime Minister went for it—not for any other reason.

Madam Deputy Speaker: Order. I remind all hon. Members of the importance of using only parliamentary language in debate.

Eric Pickles: My hon. Friend makes a powerful point and could have done so within the terms of debates in this House. I have no objection to saving the skin of the Minister of Communities and Local Government. We have great affection for him on the Conservative Benches and wish him well in his future career.

Robert Key: My hon. Friend is wholly right to point out that when the council tax was introduced it was received with some acclaim on both sides of the House, and we did not then hear such arguments from the Labour party. I was the Minister who had the misfortune of taking the legislation through the House with Michael Portillo. We specifically looked at how property could be revalued from time to time, and I remember an exchange in debate in the middle of the night between the right hon. Member for Sheffield, Brightside (Mr. Blunkett), who has just left the Government again, and my right hon. Friend, as he then was, about whether we should have inflatable balloons floating over people's back yards, which is no sillier a suggestion than those we have heard this weekend. This is not just a question of balancing function and who pays. The Minister of Communities and Local Government has forgotten that the whole point about whether local government finance is to succeed is where the balance lies between Treasury funding and the raising of tax locally. That is what the Government have failed to address.

Eric Pickles: My hon. Friend comes to these matters with considerable knowledge and I entirely agree with his point about the balance of funding. If I am allowed to make a little progress, I shall come precisely to that point.
	It is worth reminding the House that in 1998 the Command Paper, "Modern Government: In Touch with the People", examined the popularity of the council tax and in clear and unambiguous words endorsed the tax by saying:
	"The council tax is working well as a local tax. It has been widely accepted and is generally very well understood".
	Yet, after seven short years, there is a very different public perception of the tax. That is best summed up by Sir Michael Lyons in his letter to stakeholders on 20 September, which stated:
	"Council Tax has suffered from problems relating to its rate of increase and perceived unfairness".
	That is understandable when the Government cap councils that have increased council tax by a few pence a week and ignore others that have introduced increases many times that size. It is understandable when pensioners are being thrown into prison. It is understandable when a third of the increase in the basic state pension has been taken up in higher council tax for a typical pensioner.

Grant Shapps: Is my hon. Friend familiar with another aspect of council tax—that students are not required to pay it? The Government helpfully provide a CBT1 form, which is returned by local authorities to the Office of the Deputy Prime Minister each year recording the number of properties in the hands of students, but because the reporting time is in the autumn, the actual number of student properties is not known until the following spring. Students are generally slow to return their council tax demands and to get an exemption form. As a result, areas such as mine miss out to the tune of £500,000 or £750,000 and face a further problem, which is surely why people are paying too much through their council tax.

Eric Pickles: I congratulate my hon. Friend on his ingenuity in making an important local point—

Phil Woolas: Which is wrong.

Eric Pickles: The hon. Gentleman says that my hon. Friend is wrong, but there are a number of indices of the way in which the council tax grant is developed and sometimes there is a significant time lag. If I were the Minister, I would not be so quick to dismiss that.
	The Government's increased use of means-tested benefits and complex application forms has resulted in reduced take-up of council tax benefits, which means that more people on lower incomes are paying higher council taxes. Fewer than two in three eligible pensioners claim the council tax benefit to which they are entitled, compared with three out of four before Labour came to power. It is a terrible indictment of the Government that the take-up of benefit should drop so significantly under their care. The Government should feel ashamed of this unmet pensioner poverty.
	The House deludes itself if it believes that revaluing property or adding further bands will cure the unpopularity of the council tax. The increase in the   proportion of the tax taken from household budgets is a symptom of a desperate problem. The revenue generated by local authority's tax base has a direct effect on the size of the revenue support grant. Ring-fenced grants often distort the calls on the council tax—the point that my hon. Friend the Member for Salisbury (Robert Key) made so eloquently a few moments ago.
	The Minister of Communities and Local Government was a Minister in the Department for Education and Skills when the passporting of school funding was introduced. That led to some authorities suffering a cut in funding for other services, and to many more receiving nothing for other services.
	The Audit Commission became so worried about the rise in council tax levels that it produced a report. Thanks to the Audit Commission, we all know why council tax has risen since Labour came to power. The report outlines three main areas—first, the changes in the grant formula; secondly, the implementation of Government initiatives, often unfunded; and thirdly, national pay rates.
	Each year the fiasco drags on, and each year it gets worse. In a document that the Government tried to suppress, entitled "Beyond the Black Hole—a time of opportunity and challenge", the Local Government Association states that there is
	"a £2.2 billion black hole in the funding for local government, equivalent to an increase of 10 per cent.—or around £100—a year in council tax bills".
	I note from the Financial Times this morning that Ministers are taking the begging bowl round to find ways to reduce the council tax. It would be a wise thing to do, if they are. The bung in the settlement is equivalent to £1.4 billion. The right hon. Gentleman's political future depends on stretching that to £2.2 billion.

Hugh Bayley: The Opposition's motion states that their complaint is that the Government are delaying rather than cancelling the revaluation. Does that mean that the Conservatives would never have a revaluation in the future, and would allow council tax banding to become less and less related to people's ability to pay?

Eric Pickles: The hon. Gentleman has considerable expertise in the matter, but he would have been advised to listen to what Members say in the House. I said that the purpose of a revaluation was to take care of distortions in the property market, and I demonstrated clearly that no distortion has taken place. By and large, over the past 10 years property values have realigned, and matters could be taken care of by adjusting the banding. That is an established fact.
	The imbalance between central and local government funding grows, which will force Ministers towards crude and universal capping in the vain hope that public ignorance of—

Hugh Bayley: rose—

Eric Pickles: The hon. Gentleman will have to improve his interventions before he tempts me to give way.

David Borrow: rose—

Eric Pickles: I will make a little progress, if the hon. Gentleman will forgive me.
	The public have rumbled the Government and have acquired out of necessity an understanding that most local authorities are just the messenger delivering the bad news of high bills. The stealthy postponement of the revaluation will not hide the true responsibility for Labour's favourite stealth tax.
	Let us deal with the cost of the revaluation. During the debate a couple of weeks ago, I mentioned the rapid rise in the cost of the revaluation operation. Let me remind the House that the cost of the revaluation is spiralling out of control. In 2004, the Government estimated that the revaluation would cost £108 million. In July 2005, the cost hit £178 million, which is an increase of more than 60 per cent. Much of the £60 million that has already been spent has been lost because of the postponement, and it would be criminal to spend more.

David Borrow: rose—

Eric Pickles: Why have costs spiralled so significantly? Given the examples of the Child Support Agency and identity cards, the Government are renowned for their inability to keep within estimates. Is this just another example of optimism over experience? In fairness to the Government, I think that the reasons are more complex than that and go to the very heart of the revaluation.
	The revaluation is much more complex than that undertaken in 1992. The 1992 revaluation, which established the council tax, placed each house into one of eight valuation bands based on 1991 house prices, with the bands being determined by primary legislation. The banding of the individual properties commenced in January 1992, and the draft valuation lists were published in December 1992. In other words, valuers knew the banding structure when they conducted their assessments. They did not need to draw up a list of numerical valuations for each property and merely had to place each property in a band.
	As the Valuation Tribunal Service notes to the Local Government Finance Act 1992 state:
	"It is important to remember that the legislation requires Listing Officers to place each dwelling within a Council Tax band and not to place a precise value on each dwelling".

David Borrow: Will the hon. Gentleman give way?

Eric Pickles: I have told the hon. Gentleman that I will give way. He must be patient.
	The short-term expediency of pushing off all the unpleasant decisions into the long grass for Sir Michael Lyons means that that approach cannot be followed. No one knows how many bands there will be or where they will be located in the 2005 revaluation. As a result, the Valuation Office Agency decided that it had to calculate a numerical property value for every home, in order to place those homes in their appropriate bands later. The relevant internal note has been deposited in the Library:
	"Given the degree of uncertainty around the council tax bands in 2007, EVERY property will probably need a specific numeric valuation so, when the bandings are finally agreed, properties can be allocated their bandings quickly".
	The note lays the blame firmly at the Government's door:
	"No decisions have yet been reached by the Government on whether, and if so what, revisions should be made to the level and number of council tax bands. Those decisions will be informed by the outcome of the review currently being undertaken by Sir Michael Lyons due to report by end of 2005".
	Since that note was written, the schedule for the Lyons report has slipped further back.
	The revaluation will be more expensive, more intrusive and much more difficult to perform than the last one, when only 10 per cent. of houses were inspected and, in the valuation office's own words, the remaining houses were assessed, "at the desk". Furthermore, the number of dwelling house codes has jumped from 10 to 17.

David Borrow: I am grateful to the hon. Gentleman for giving way. When valuations in the current valuation list for council tax are defended, a precise valuation based on purchase prices in the early part of the 1990s is used. Does the hon. Gentleman agree that there is no difference in effect between a revaluation before bands have been set in stone and a revaluation when bands   have been agreed, which was the situation before the current valuation list?

Eric Pickles: That is an interesting view, but the valuation office notes, which are extensive, do not mention it. Sadly, the notes do not agree with the hon. Gentleman.
	Turning to the dwelling house codes, I took it from what the Minister of Communities and Local Government said earlier that the patio tax will be worked out in readiness for the revaluation.
	The new dwelling house codes include: number of bedrooms; number of floors; lowest floor level; conservatory type and area; outbuildings; and a new system to count the number of garage spaces and parking spaces. They include the introduction of new value significant codes, which in January 2005 were expanded to cover 66 different property features, such as: balconies; near a golf course; in a conservation area; large garden; large patio; roof terrace; sea views and views of hills or lakes; and gated estates.
	In other words, someone who has worked hard to manage and improve their home will be penalised and taxed more. The council tax of a low-paid agricultural worker living on their own in a modest home overlooking Lake Coniston will rocket. Pensioners who have retired to little bungalows by the sea had better watch out. Under new Labour, only the rich can afford to enjoy a view or a well-placed patio. The result is that the codes ensure that properties with these indicators are pushed into a higher council tax band. In short, the patio tax becomes a new window tax. As The Sunday Telegraph commented yesterday in its editorial entitled, "Pay per view homes",
	"The plan will allow ministers to increase council tax with a minimum of Parliamentary debate. It is true that they have not found a way of taxing happiness directly. But just give them time—they will."
	We should be grateful for this important lesson in life under new Labour. As a gentle summer light caresses patios and plant pots around this sceptred isle, as hollyhocks and forget-me-nots bob in the warm breeze in this green and pleasant land, we should console ourselves with the thought that this is the clearest example of there being no such thing as a free view or a peaceful garden—all must be taxed and all pleasures must be stamped out.
	That is the logical conclusion for a Government who have selected Northern Ireland as a guinea pig, with so-called discrete capital values that would make the council tax more progressive and target social needs. In plain English, council tax bills in Northern Ireland will soar. It has been selected for yet another experiment that involves a variation in the council tax—the death tax, whereby deferred local tax bills will be paid by pensioners. Vulnerable people must either forfeit their children's inheritance or face the prospect of bailiffs at the door. Only the Labour party could find ways to pursue poor people beyond the grave.
	The Local Government Chronicle has described revaluation as "a ticking time bomb". All that the Government have done is to wind up the clock and adjust the hands. Revaluation and re-banding will still have a devastating effect. A disaster postponed is not a disaster averted. What seems like clever politics now will seem like cowardice a few years down the road.

Nick Raynsford: I regret to say that I cannot support the Second Reading of the Bill. Having said that, the speech by the hon. Member for Brentwood and Ongar (Mr. Pickles) was extraordinary. Before he got carried away in his flights of floral fantasy, he said that he agreed with the postponement of the revaluation and with the removal of the obligation to carry out revaluation on a regular 10-yearly cycle. I would have wholeheartedly agreed with him on both counts, but he does not appear to want my support.
	Everyone who has considered this issue starts from the simple proposition that if we have a system of local government taxation based on local property values, those values must be revisited periodically. No one has argued credibly that the current values based on 1991 levels should remain the basis of council tax for ever more.

David Curry: Is not it true that between 1.6 million and 1.8 million properties are revalued every year because they are sold?

Nick Raynsford: The right hon. Gentleman rightly highlights that the existing framework provides for revaluation if a property's value has materially changed and it has been sold. However, that does not apply if the property remains in the hands of the existing owner. That is one of the many inherent anomalies in a system which has prolonged gaps between regular revaluations, and one of the strong arguments in favour of a regular cycle of revaluation. I was therefore especially disappointed to hear the hon. Member for Brentwood and Ongar opposing the provision of such a regular cycle.

Paul Beresford: Does the right hon. Gentleman agree that, although the council tax is based, for collection purposes, on property, the valuation is required only for distribution of grant and tax?

Nick Raynsford: The hon. Gentleman tries to lead me into territory that I shall probably cover when I reach a later part of my speech. I want to set out the principles that should inform a proper system of tax based on property values that allows for revaluation. I hope that the hon. Gentleman will bear with me for a moment.
	The problem with the Government's position is that, although they say that they are postponing, not cancelling, revaluation, they have given no indication about when the postponed revaluation will take place. The date of 2007 was set for revaluation after a lengthy period of consultation. The Green Paper, "Modernising Local Government Finance", which was issued in autumn 2000, invited views on whether there should be   provision for regular revaluations and, if so, how   frequently. It was suggested that there might be six-yearly, eight-yearly or 10-yearly gaps between revaluations.
	The 2001 local government White Paper, which I had the privilege of preparing and implementing, made it   clear that respondents to the consultation overwhelmingly supported the principle of a fixed cycle. The White Paper announced the Government's conclusion that there should be a regular 10-yearly cycle of revaluation, with the first being based on 2005 values and taking effect from 2007. There was a logic behind that.
	As my hon. Friend the Member for South Ribble (Mr.   Borrow) pointed out—as a former valuer, he is experienced in such matters—the cycle for valuation must be co-ordinated with the current five-yearly cycle of business rates revaluations to avoid imposing unreasonable pressures on the staff of the Valuation Office Agency. It was therefore considered sensible to conduct the first revaluation of council tax as soon as possible after the completion of the 2005 business rates revaluation and well before that of 2010. That was the logic behind choosing 2007.
	That was not only agreed through all the usual channels of Government but, because legislation was required to effect the decision, debated at length in 2003 during the passage of the Local Government Bill. The measure was passed, arrangements were made to begin the revaluation in 2005 and the Valuation Office Agency undertook a great deal of preparatory work. I   understand that some £60 million of work had already been done before it was decided a couple of months ago to stop the process.

Nick Hurd: Does the right hon. Gentleman accept that regional property price disparities are at the heart of the case for revaluation? If so, does he accept the evidence from the Halifax that those disparities have narrowed since 2001? Does he agree that, if the trend continues, the case for an expensive wholesale revaluation is critically undermined?

Nick Raynsford: No, I do not. I shall deal with the evidence from the Halifax shortly. Regional trends, which are part of the picture, conceal many local variations, with both hot spots and cold spots in any one region. The proposition that regional price differentials might be narrowing does not obviate the need for revaluation because there will be considerable variations in property prices in every region.

David Borrow: Does my right hon. Friend agree that, if there has been little change in relative property values, as the hon. Member for Brentwood and Ongar (Mr.   Pickles) alleged, a revaluation would not lead to large increases in council tax for many people?

Nick Raynsford: My hon. Friend is absolutely correct. He identifies one of the glaring inconsistencies in the Opposition's position.
	If a carefully thought through Government policy that had been the subject of detailed consultation and legislation—and which, incidentally, had been defended robustly against opportunistic Opposition attacks—was now to be reversed, one might think that there would be either compelling evidence to justify the volte face or specific alternative arrangements for conducting the revaluation that the Government accept must happen at some stage. As we can see from the Bill, however, nothing has been put in the place of the current requirement for a revaluation in 2007 and subsequently on a 10-yearly cycle.
	I know that my right hon. Friend the Minister of   Communities and Local Government has acknowledged—and, indeed, rather celebrated—the fact that he has accomplished a U-turn on this issue. I   have no problem with U-turns if they replace a poor policy with a better one, but I do have a problem with a U-turn that replaces a sensible policy with a void, a vacuum, an empty space in which a revaluation might happen at an unspecified future date, but only if the Secretary of State decides to hold one.
	I have a serious problem with that strategy because, as we all know, politicians are traditionally wary of revaluations because they fear electoral unpopularity. That sentiment is not the preserve of any one party; over the years, all Governments have been reluctant to proceed with revaluations because of the possible backlash from the electorate, who are likely to be unhappy about them. It is fundamental that there should be a regular cycle of revaluations in statute, so that that process—which everyone recognises must take place in order to support a credible system of taxation based on property values—will not be postponed simply because of short-term political fears.

David Howarth: I agree about the need for revaluations in property-based tax systems, and about the fact that politicians are deeply unwilling for such revaluations to be carried out. Surely that argument supports the objection to having such a tax as the main local government tax.

Nick Raynsford: No, it does not. If the hon. Gentleman had been listening carefully to me, he would understand that it provides a reason for ensuring that we have a regular cycle for revaluation, so that such temptations to delay can be resisted. The argument in favour of a council tax is that it is relatively simple to collect and difficult to evade, and that it meets with a high level of acceptance. There are huge problems with his party's preferred alternative of a local income tax, which is neither predictable nor easily collectable. It would also be very easy to evade, and it would be open to huge administrative costs. It would also place burdens on business and result in arbitrary consequences for households with two or more earners, who would find that they were clobbered. The hon. Gentleman will realise, when he gives a little more thought to the issue, that the electorate roundly condemn his party's proposals as unworkable, as indeed are so many of the Liberal Democrats' proposals.

David Clelland: I am interested in the direction that this conversation is taking. Is my right hon. Friend aware that the Minister recently said that property-based taxes were introduced at a time when services—such as water, electricity and sewerage—were based on property, while services today, including education and social services, are based on people? Do the Minister's comments suggest that the reason for the delayed revaluation might be that, in the minds of Ministers, there might not be any need for a property tax in future?

Nick Raynsford: I have listened carefully to the comments made by my ministerial Friends, and they have made it clear that they do not intend to move beyond the remit of the Lyons review, which is to consider changes to and reform of the council tax, but not a replacement for it. That was the remit given to Sir Michael Lyons, and that is the premise on which we are proceeding. If, in future, alternative plans are put forward, hon. Members will obviously wish to consider them very carefully, and with considerable scepticism. The experiences of previous attempts to change from a property-based tax to a person-based tax are not happy. The poll tax was one of the most unhappy experiences in the entire history of local government finance, and very few people would want to go back in that direction.

Stephen Crabb: Will the right hon. Gentleman give way?

Nick Raynsford: I would like to make some progress. I   have just given way, and I do not want to take up too much more time. I hope that the hon. Gentleman will bear with me.
	What are the consequences of the Bill? We know that the basis of the council tax—the 1991 values—will become increasingly remote from reality as we get further away from the current valuation date. Having to calculate notional 1991 values for every new property built is nonsense. As I mentioned in our previous debate on the subject, some areas of my constituency were entirely void industrial wastelands 15 years ago, and anything built there would have had no value at all, so, now, it is slightly odd to create notional 1991 values for properties built as a result of that area's regeneration. That pattern is replicated all over the country. In addition, as the former Minister responsible for local government, the right hon. Member for Skipton and Ripon (Mr. Curry), rightly highlighted, there are already provisions for revaluation of some properties where those properties change hands and there has been a material change in value. The anomalies will therefore get worse.
	The overwhelming majority of properties, of course, have increased significantly in value since 1991—by some 216 per cent. on average, according to the Royal Institution of Chartered Surveyors. That is part of the problem. Many people who are not familiar with the arcane nature of the council tax process can easily be frightened into believing that because their property's value has increased dramatically over the past 14 years, they will be clobbered by revaluation. That is fuelled by unscrupulous Opposition scaremongering, of which we saw a great deal in the run-up to the general election, and of which we have heard a great deal more today. That does not help to foster a serious and rational debate about the proper system of finance for local government.
	As the Government have made repeatedly clear from 2001 onwards, however, the purpose of revaluation is not to increase the council tax yield but simply to bring values up to date, so that the tax is based on modern values rather than values that are increasingly remote from reality. Were the bands to be increased in line with house price inflation since 1991, most households would find themselves in the same band as before, with no increased liability for council tax. I have seen no recent Government estimates for the numbers of households whose banding would either increase or decrease under a revaluation. My right hon. Friend the Minister of Communities and Local Government has assured me that no new Government estimates have been prepared for Ministers since the election. The only official figures are those prepared previously—before the April 2005 valuation date. I am a little surprised that new estimates have not been prepared to inform Ministers' decision to postpone the revaluation, but in the absence of up-to-date official figures, we can only go on the evidence produced by well-informed commentators such as the RICS and the Halifax building society. Both indicate that the majority of households would have remained in the same band as a result of revaluation, and also suggest that more households would have gained than would have lost.

Eric Pickles: I want to ask the right hon. Gentleman a very straightforward question: if what he says is correct, what went so terribly wrong in Wales?

Nick Raynsford: As we have debated frequently in the past, the situation in Wales was very different because there was an increase in yield there. The Government have always made it clear that there would be no increase in yield in England. In Wales, the yield has increased by some 8 or 9 per cent.—

David Davies: rose—

Stephen Crabb: rose—

Nick Raynsford: I am trying to bring my remarks to an end, and the hon. Member for Brentwood and Ongar has led me into territory that has immediately provoked some of his hon. Friends. I will give way to the hon. Gentleman who was first to rise.

Madam Deputy Speaker: Order. May I remind Members that the Bill currently before the House has no reference to Wales? I can allow some reference to what happened, but I am mindful that this Bill is for England.

David Davies: I am grateful to you, Madam Deputy Speaker, for your advice. I merely wish to point out that Welsh Assembly Members supported revaluation on the basis of being told at the time that there would be no increase in yield. I warn Members of what I call the mother of Parliaments, here in London, that they could be making the same mistake.

Nick Raynsford: There is no such intention in England. The commitment was to ensure a revaluation based on the current yield, with no increase in yield. In Wales, a number of changes were made: an additional band was added, which must had some impact on that process. It was therefore a very different scenario, and we should not assume that because there was an increase in Wales, there would be a similar increase in England. If the hon.   Gentleman examines the figures, he will see the   difference. As I said, the estimates produced by both the Halifax and the RICS show that a larger number of households are likely to gain from revaluation than to lose. I do not remember the precise figures, but about 33 per cent. of households in Wales lost and only about 8 per cent. gained. That is a very different scenario from the one that we envisage for England.

Nick Hurd: Will the right hon. Gentleman give way?

Nick Raynsford: I will give way once more, but it will be the last time. I really must make progress.

Nick Hurd: I am puzzled by the right hon. Gentleman's suggestion that there may be more winners than losers. If that is the case, why are the Government running away from their decision?

Nick Raynsford: I merely said that, in the absence of official figures, evidence from the RICS and the Halifax implied if a revaluation were conducted with no increase in yield—if house price values were simply uprated in line with average house price inflation since 1991—the   overall impact would be neutral, but the number of   households that would gain would be larger than the   number of losers. As the figures show, that is because there would be rather more gainers in the lower house price bands, and a disproportionate number of losers in the higher bands.
	That brings me to my final point. If those figures are valid, it appears that the Bill will be regressive. It will result in more households on lower incomes paying more than they should because of a failure to revalue, while those in higher income bands and occupying more highly priced properties, who would possibly have paid more because the value of their properties has risen, will be spared. I cannot support a measure which seems to me to have no logic and no principle behind it, and which will have a regressive impact. It saddens me to say this, but I will not be able to support the Government tonight.

Sarah Teather: Remarkably, this is the only Bill to emerge from the Office of the Deputy Prime Minister in more than a year. We must assume that the Department has been very busy with other matters. If this is the total production of 9,000 staff and two Cabinet Ministers, we need to ask some serious questions about the use of resources. Let us face it: there is not much to the Bill. It proposes postponing revaluation for the present because the Government think that it might be politically unpopular. The tragedy is that, to cover that giant U-turn, they have also postponed Sir Michael Lyons's review of local government finance.
	Is it not embarrassing for Ministers to present the Bill   as the sole outcome of nearly three years of reviews of local government finance? The first review, back in   2003, recommended a review of a review. As far as I   remember, the review of a review was supposed to evaluate revaluation. Now the Government have reviewed the review of the review evaluating revaluation until such time as they can review the review of the review's review to revalue.
	I cannot help thinking that when the review of the review finally gets around to reviewing the review on revaluation, the Government's response will be to set up yet another review. I know that it is dangerous to rush into decisions, but this must be the most reviewed act of dithering that we have ever known.
	Debates on issues such as this tend to attract quite a small crowd, and we usually see the same few faces. That means that those in the Chamber should understand better than anyone else that local government matters, and that local government finance matters. Yet today we shall spend hours arguing about the essentially technical issue of the date on which property values should be fixed for council tax purposes, rather than asking any of the more difficult questions. We should be asking how much tax should be raised locally, what taxes local government should have power to levy, and how much freedom local government should have to spend its own money. We shall discuss none of those issues in detail, however; we shall have the same fatuous debate that we have had before. We shall rehearse arguments that have already taken place.
	I find the Conservatives' position bizarre. We have discussed many times before whether they want to cancel or postpone revaluation. In the course of a single speech, I heard two separate views. They have said that they want to postpone revaluation, but oppose the Bill in their amendment because it does not cancel revaluation. We will hear the same arguments again and again. The Government will try to make a virtue out of a U-turn, and will not commit themselves to anything in particular. That strikes me as a terribly wasted opportunity.

David Borrow: Would the hon. Lady prefer the council tax revaluation to be postponed until the review of local authority funding is published, or would she prefer it to go ahead and then have the review of local government finance?

Sarah Teather: I shall answer that question during my speech. If the hon. Gentleman listens carefully, he will hear the answer.
	What is there to say about this long-awaited Bill? Not a lot, actually. It does exactly what it says on the tin. It gives the Secretary of State the power to have a revaluation whenever he fancies it, instead of according to a fixed cycle. Hon. Members who want a revaluation, including the right hon. Member for Greenwich and Woolwich (Mr. Raynsford), are disappointed by that. The idea of a statutory cycle was, as the hon. Gentleman said, to remove the choice because, as everyone knows, if one gives politicians the decision there will be no revaluation. Keith Parry's marvellous Library note for   today's debate includes an historical note on postponements of rate revaluations going back to 1925, all with similarly dubious excuses. That point has been well made.
	Originally, the Government set revaluation to occur after the 2005 general election because they did not want the fallout to affect their chances. Now there will not be a revaluation until after the next general election—because they do not want the fallout to affect their chances. Will there ever be a revaluation? Will the timing ever be right? Probably not, so we shall continue to have a tax that not only is inherently unfair but becomes increasingly arbitrary, based on property values that are 15, 20 or 25 years old.
	Revaluation, as we have debated so many times here, leads to winners and losers. As we have seen in Wales, its effects are often unpleasant, unfair and untidy. No doubt we shall hear from Welsh Members about the impact on their constituents. The hardship felt by many who have gone up multiple bands is the reason that my Welsh colleagues have been leading calls to extend the transitional relief in Wales, so that the situation gets no worse. The problem with council tax is that the tax itself is fundamentally unfair and bears little relation to one's ability to pay, so the arbitrary nature of band shifts following revaluation is felt all the more keenly.

David Davies: rose—

Sarah Teather: I mentioned the key word "Wales", so I must give way.

David Davies: The hon. Lady may be pleased to know that I am not going to talk about Wales. She said that the council tax is unfair in itself. Is not it the case that that simply was not an election issue, certainly not in 1999? It was not the council tax itself that was upsetting people, but the level of tax that they were paying.

Sarah Teather: I do not accept that. I was about to do what I do every time I debate this issue here and remind hon. Members how unfair council tax is. I could spell out again exactly how much better a local income tax would be but, as I said, it is always the same people in these debates and they have heard it all before.
	I would like, therefore, to focus on the Bill's greatest sin: omission. The Bill does nothing to solve any of the problems that councils and council tax payers face. Local government is in charge of raising only about 25 per cent. of its money and, thanks to capping, it is not even fully in control of raising that 25 per cent. Hon. Members will remember with incredulity our debate in July, when, in a place that used to legislate for half the world, we were reduced to telling Aylesbury Vale district council what it could do with 4p per resident per week.
	Because local government funds come in the form of handouts from central Government, the money comes with a host of qualifications, criteria, rules, regulations and restrictions. It is that relationship that damages accountability. It reduces local flexibility, undermines local responsibility, hinders longer-term planning and creates huge unfairness. It often leads to accusations, which are frequently unfair, that Ministers are using the power of the grant to favour their political heartlands. That mixture of central grant dependence, passporting, ring-fencing, targets and capping leads to the annual crisis in council tax rates, which began again just last week when the Local Government Association predicted a £2.2 billion black hole.

Alan Whitehead: In a previous debate, the hon. Lady said that under her proposal for a local income tax there would be a substantial element of equalisation of central Government grant, and referred to the total amount that local income tax would raise. By simple arithmetic, the figure she gave would mean that the amount of equalisation grant that remained to be distributed would be roughly the same as it is at present. How, then, would the hon. Lady's vision of local government completely free from any grants from central Government come about?

Sarah Teather: First, we have always envisaged a two-stage process. We would need to scrap council tax and implement a local income tax. We want a shift between national income tax and local income tax, cutting national income tax and raising proportionately more locally. We would leave that to local discretion, but we would also localise business rates, which—

Madam Deputy Speaker: Order. I have allowed some digression but could we please now get back to the subject of the Bill, which is revaluation?

Sarah Teather: I was trying to avoid discussing the detail of local income tax, but hon. Members cannot resist it and we get drawn into these debates.
	As I said, we have a huge black hole and we will go through the usual saga: posturing by the Government, visions by councils of their spending and concomitant headlines about cuts in social services. There will then   be   marches against council tax rises and finally a last-minute panic—

Madam Deputy Speaker: Order. I remind the hon. Lady that the Bill deals with revaluation and not local government finance in general. There can be some reference to that, but not at length.

Sarah Teather: I was trying to make a point about what the Bill omitted, but clearly we shall have to have that detailed debate elsewhere. My point is that this is a ridiculous waste of time and energy and that going through this saga is holding local government back from making decisions itself, which is vital. I am disappointed that the Bill does not include those matters because it is vital for improving public services that we have that kind of provision. We are easily distracted by revaluation, which we all know would only fuel the sense of outrage in its losers, who already hate the tax anyway.
	The political implications of rocketing bills are easy to   grasp. Certain Government members probably even revel in having made a barefaced U-turn on revaluation because it means that they can boast about their honesty in admitting a mistake. The Minister of Communities and Local Government, the right hon. Member for South Shields (Mr. Miliband), said at the time that the Government were still moving forward—just in a completely different direction. Clearly, he is a great wit, but his position is of no help to those in local government who need to know what the Government are planning.
	The bizarre argument that the Government are postponing Lyons and revaluation to allow Sir Michael Lyons to look at the issue in a more holistic way does not hold water. The date for revaluation has been set in stone since the last Local Government Act. Why did it take the Government two years to realise that voters live in houses?
	Revaluation is basically a political sideshow. Postponing it does nothing to help pensioners lining up to go to prison because they cannot pay. Nor does it do anything to tackle the injustice of families on half the national average household income paying over £1,000 in council tax.
	This has been a relatively short speech, but then this is a short Bill that aims low and achieves less. Frankly, there is not that much to say about it. If it is passed with no further reforms, we shall have the absurd situation of having a tax based on a poor guess at a home's value 15 years ago. But rejecting it, as the Conservatives are trying to do today, would be just as pointless, because revaluation would do nothing to make council tax fairer either. It would just make it slightly different. Frankly, neither option is appealing.

Kevan Jones: Will the hon. Lady give way?

Sarah Teather: No, I am about to finish.
	This is rather like asking a vegetarian whether they would prefer steak or bacon. The Bill should be withdrawn and replaced with something sensible that tackles the system of local government finance. The Government will not do that, but we will when we win in 2009. So while we wait for the power to introduce something different, we see no point in having a revaluation. It would be a costly waste of money; as we have heard, £60 million has been wasted on it already. It would be a total waste of time, given that we intend, when we are in government, to scrap the tax anyway and replace it with local income tax.
	I shall not go though all of the arguments again, because we have heard how much better a local income tax would be. We have heard also that we would localise business rates and make sure that local government has a proper system of finance. Even if hon. Members disagree with me about local income tax, they should agree that this whole revaluation fiasco is merely an excuse to defer once again the crucial question of a   decent financial settlement for local government. Transforming local finance is key to transforming public services. We should not waste our energy fighting over revaluation just because it is an easy political game. We should invest our energies in solving the real problems: that the council tax is unfair, and that local government is held to ransom by the current funding system.
	Every minute that we fritter away on revaluation is a minute that we do not spend trying to solve those underlying problems, so I think that I had better shut up and sit down.

David Borrow: In getting back to the subject of this Second Reading debate, I   should begin by pointing out that, as a member of the Institute of Revenues Rating and Valuation, and of the   Society of Clerks of Valuation Tribunals, I have some professional involvement in this area. I have certain predetermined views on local government finance.
	I should also make it clear that I see some merit in the Government's argument for ensuring that revaluation is tied to a review of, and re-jigging of, local government finance; my real concern is the length of that delay. The history of any property tax shows that the longer revaluation is delayed, the more that tax is fundamentally undermined. There was a revaluation in the years immediately after the war, when the Inland Revenue was responsible for valuing the rates. There was another revaluation in 1956, and further revaluations in 1963 and 1973. By the end of the 1980s, after various Ministers delayed a further revaluation and following the experience in Scotland, it was impossible for the then Tory Government to have another one. We ended up with the poll tax.

Paul Beresford: I am listening to the hon. Gentleman's opening shots with interest. He is comparing rates with council tax, but the situation is different. At the moment, valuation for council tax purposes is used for the distribution of grant and of the tax itself. So many of the arguments used earlier by the right hon. Member for Greenwich and Woolwich (Mr.   Raynsford) actually support the positions of both the Government and of Conservative Front Benchers, so long as the proportions do not change dramatically.

David Borrow: I shall deal with that point now. Let us contrast such revaluations with the revaluation of business rates. Since business rates were nationalised in 1990, we have stuck to five-yearly revaluations, which have been supported by all those affected. Their argument is not that because no big changes have occurred in a given five-year period, there should be no revaluation. Rather, the argument is that if comparatively small changes in relative values occur under a system of regular revaluations, the impact of each revaluation is not so massive, be it on businesses or those occupying domestic property. If we argue that we do not need a revaluation because—allegedly—there has not been a big change in relative property prices in the past 14 or 15 years, and if we have revaluations only when there is a massive change in the relative prices of property, the danger is that the impact will be huge, with a lot of winners and a lot of losers. Under such a system, it will become virtually impossible for a Government of any colour to proceed with that revaluation.

David Heath: The hon. Gentleman is talking a great deal of sense. But I am concerned about the sanguine view that, because the majority of properties will stay in the same band—the   point made by the right hon. Member for Greenwich and Woolwich (Mr. Raynsford)—which is inevitable, given that we are talking about an average, that is somehow all right, and that the winners and losers will somehow balance out. Is it not true that the winners will be concentrated in certain geographical areas and the losers in others? My part of the world, the west country, has experienced rapidly increasing property prices—a point that applies whether one is on a high or a low income. That is the basic unfairness.

David Borrow: I come back to the experience of regular revaluations for business rates. When revaluations took place in the 1990s, some parts of the country experienced booms in property rents and certain classes of property had large increases in comparison with others. Provided that we have regular revaluations and some sort of transitional relief in place, we have a way of coping with the problem. We do not want to find ourselves in a position where we cannot have a revaluation because the change is so massive.
	I remember looking into property values in central Liverpool in the early 1980s. At that time, rates were based on rental values of the early 1970s and many business properties in the area were attracting more in rates than in rent. At the same time, there were tenants in central London paying 10 or 20 times as much in rent as they were in rates. That reflected the change in the economy during the period. It was also reflected in changes in domestic property values, albeit to a lesser extent.
	Another important problem with putting off property revaluations is that they have an impact on Government grants. The longer we delay revaluations, the longer it will be before Government grants reflect economic differences between one area and another. Liverpool got hammered in the 1980s with cuts in services and real financial problems. Had there been regular revaluations throughout the 1970s and 1980s, I suspect that Liverpool city council's budget position would have been much stronger in the 1980s because the revaluations would have reflected the recession in the   city and would have fed through into the amount of Government grant awarded. We never did the revaluations, so that never happened.
	I shall vote in the same Lobby as the Minister tonight, though I was tempted by the appeal of the hon. Member for Brentwood and Ongar (Mr. Pickles) to vote in his Lobby—until he spoke. I hope that when the Minister sums up, he will provide some reassurance that we are not talking about a long delay.
	I want to restate a point that I made in an earlier intervention—that the reason for having a revaluation in 2007, as against a business rate revaluation in 2005, was to even out the work load of the Valuation Office Agency, the valuation tribunals and all those involved in the valuation of rating and council tax. The danger is that we could end up with a revaluation of council tax not in 2011 but in 2013—20 years after the first council tax valuation. It is important that the revaluation of council tax ties in with the reform of local government finance because of the revaluation's impact on the amount of Government grant. Those two aspects need to be tied together under a new regime, rather than introduced separately. The timing is crucial.
	I want to comment on the views of Her Majesty's Opposition. On the one hand, they complain that domestic property prices have rocketed, with huge increases all over the place, so that a revaluation will mean some people paying a huge amount more. On the other hand, they say that there has been hardly any difference, so we do not need a revaluation. Both those arguments cannot be right. I have served on Standing   Committees in which Conservative Front-Bench spokesmen have said that there should be regular revaluations. There is plenty of documentation in the Library about the occasions on which Tory Front Benchers have argued in favour of having regular revaluations. Indeed, the Front Benchers currently accept the need for them, albeit as long into the future as possible.
	The danger is that if we continue to put off council tax revaluation, whoever is in power in five or 10 years' time will be tempted to do a Michael Heseltine and we shall end up with council tax being unsustainable, so that it has to be ditched completely and something else dreamed up in its place. Let us do it properly. I want some assurances from the Minister that the postponement will be a short and sensible one, not one born of political expediency.

David Curry: This is a grubby little Bill that reflects a very English mess. If we build new houses—and the Deputy Prime Minister wishes to build very many new houses—we will all have to pretend that they were built in 1991 for the purpose of valuation and a fictional value will be associated with them. Let us suppose that I buy one of those houses and put on a conservatory and a granny annexe—although they are unlikely to be big enough to allow the latter addition—and, a couple of years later, I sell it. It will be revalued for council tax purposes and will probably go up a band. Let us suppose that the right hon. Member for Greenwich and Woolwich (Mr. Raynsford) lived next door and had decided to spend the rest of his life in his house, so he had added a conservatory, a granny annexe and an extremely well-appointed garden shed. He would pay less council tax, even though he had a much more valuable asset.
	There are between 1.6 and 1.8 million house sales a year in Britain, or some 34,000 a week. Even allowing for sales of properties to which no substantive change has been made, a relatively high proportion of houses have been revalued—some more than once, depending on property turnover in the area—and that creates anomalies. Across the country, people ask, "Why on earth is he paying the same as I am? He has a much bigger house." My colleagues talk about the battles and the discontent that a revaluation would bring, but we should remember how much seething discontent can be caused by failing to have a revaluation and the continuation of the anomalies.
	I know that you do not wish us to trespass beyond Offa's Dyke, Madam Deputy Speaker, but the situation in Wales is interesting. There was a revaluation in Wales because the Welsh authorities decided that they wanted to get more revenue out of the system. It was not revenue neutral, because they set out to make it into a tax-raising venture, which was very successful. However, one consequence of the present situation is that the council tax will come under increasing strain. Local government finance has a wonderful capacity to start as a dot on the horizon no bigger than a man's fist and grow to emerge as a subject of colossal emotive and totemic power. We have hit just such a rough patch in the last couple of years.
	The Minister will say—I remember saying it myself and the right hon. Member for Greenwich and Woolwich also said it—that council tax yield is not the same as average council tax. Of course it is not, because more houses are built and houses are revalued, but it does provide a good rough indication of likely council tax increases. We are now destined to spend the next five or six years going through the same sequence of minatory arguments, including threats of capping and blaming the local authority. The silliest argument of all pretends that the amount of money a council raises has nothing to do with the nature of the property in its area,   as though somehow there was a curious moral perversity in the fact that Westminster manages to raise more money than Burnley on the basis of its council tax stock.
	More and more pressure will be felt because public expenditure is coming under strain and chickens are coming home to roost—as I forecast last year. There are   reasons for a postponement for one year, and Sir   Michael Lyons accepted that that was reasonable. For example, the changes in education funding and the introduction of three-year budgets make it reasonable to pause to see how all the bits will fit together. However, Ministers have suggested that we wait until there is no turbulence in house prices. What a wonderful notion. After all, the Chancellor of the Exchequer set up the Barker review to discuss why we had permanent turbulence in house prices. The link to structures is one of the most grotesque non sequiturs that I have come across, even from this Government. Ironically, we may have been living through a period when price disparities were closing to some extent. Select parts of my constituency are approaching the levels of the south, but   as the hon. Member for Somerton and Frome (Mr.   Heath) would say, the variation regionally, and even locally, can be very significant indeed.

David Heath: The right hon. Gentleman was talking about houses that had changed hands or been improved, but there is the significant problem of, for example, an elderly lady living in Rose cottage in a desirable village in my constituency. She has never improved her house and never received any income, yet the price of her property would be hugely inflated over time simply because people with London salaries like the idea of living in Rose cottage in my constituency and are prepared to pay a large amount of money for an unimproved cottage. Is there an answer to that in the council tax framework?

David Curry: From my reading of the Sunday papers, I   understand that the Cotswolds are no longer what they used to be because all sorts of fashionable people who own large properties in London, which are no doubt at the top of the band, have gone there and opened up little bistros. One perfectly reasonable answer for a person who is asset-rich but cash-poor, which is the situation of that lady, would be to allow her to roll up her council tax into the final estate. There is nothing inherently unreasonable about that notion, and it is worth examining.

Sarah Teather: But some people, such as those who rent, have no assets to liquidise and for council tenants in particular there is no relation whatever to the worth of their property.

David Curry: If we have a property-based tax, a remorseless logic follows from it, which is that properties must reflect market value, albeit with some delay. The hon. Lady went into review of review of review. I thought that there was a Liberal Democrat review of their local government finance policy, but it appears to have passed her by. The Liberal Democrats did comprehensively badly in the south-east of England and a significant explanation for that may be the amount that bills would have hit home for property owners in the region.
	It is cloud cuckoo land to think that we will have a period of no turbulence. Of course, there is a period of minimum political turbulence coming up—roughly in 2007, funnily enough, just when the revaluation was timed to hit. A Government who usually have an unfailing eye for timing appear to have missed that. The real problem is that the Government have discovered that there will be losers. They do not like losers; we cannot have losers under a Labour Government. Everybody has to be a winner all the time at the coconut shy. However, it is possible to deal with that, as I shall say in a moment.
	We are heading for conflict and much barren argument. Inevitably, old age pensioners, the canon or deacon of somewhere or other or belligerent elderly ladies will turn up at our surgeries—we wish that our agent could spot them in advance—all determined to set the world to rights. I wonder how much it will cost the taxpayer by the time they have gone through that long process, but they will manage to avoid paying fifty seven pounds, four shillings and threepence ha'penny, or whatever the amount happens to be.
	There is a way through, however. It is not rocket science, although I hate to use such well-worn expressions; I do not do rocket science as anyone familiar with my difficulties in handling the video will know. The first solution would be to link revaluation and re-banding. They go together; they are the salt and pepper of the process. Secondly, it would be perfectly possible to limit changes to a single band. In my part of the world, which might be described as regionally depressed, there are none the less areas that might be described by the right hon. Member for Greenwich and Woolwich as hot spots—Harrogate is one of them. We could stop that; the process does not have to be too sophisticated. There could simply be a shift of one band.
	I would add an upper band. Madonna has a predilection for large houses in London and large country estates. I find it charming that someone should wish to adopt the English way of life so comprehensively and expensively, but I see no reason why she should not pay an extra bob or two at the top of the band in London for that privilege. We could also add a lower band, to catch the trailer parks or areas in industrial east Lancashire that the hon. Member for South Ribble (Mr.   Borrow) will know about, where there is a long history of deprivation and empty property. It is possible to manage all those things.
	The sensible thing is to drop all the fancy stuff. My hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) was busy detailing all the sophisticated knobs and whistles that might be attached to the process. We should forget all that. The original valuation was simple, and we should keep the current one as simple as possible.
	I want to return business rates to local government, with the proper safeguards. We only need to read the snappy little document put out by the ODPM to realise   that when council tax was introduced in 1993–94 business rates represented 28 per cent. of local government revenue and council tax 21 per cent. However, the estimates for the current year are that the figures will be 21 per cent. for business rates and 25 per cent. for council tax. The position has been inverted. Business has had an easy ride over the past decade compared to council tax. It is possible to set up safeguards that would reassure business about abusive increases. Furthermore, we might just as well recognise the reality of education expenditure and take the education block back into central Government. That would pretty well solve the problem. We would have gone an enormously long way towards creating a sustainable council tax and we would have returned to local government a much wider range of local resources over which it had control.
	The history of local government funding is dismal. It is a long tale of prevarication and delay. I once described the search for a sustainable local government funding system as like the search for the north-west passage. The problem was that first, it did not exist, and secondly, there was a terrible danger of getting stuck in the pack ice. The Government are stuck in the pack ice. If they are not careful, council tax protests, difficulty in funding public expenditure and the annual demand for some sort of bung to make things easier will cause the structure of   the vessel to be crushed by the pack ice. The Government will find themselves in a wholly justified mess, which I shall rue from the point of view of my constituents but applaud in seeing the Government get their just deserts.
	The worst thing is that it will be 2011 at the earliest before anything like a proper package can be introduced. There will be a long interregnum. There may be light at the end of the tunnel, but the light is entirely at the discretion of the Minister and it is a hell of a long tunnel. The light is faint and flickering and as the right hon. Member for Greenwich and Woolwich says, the Government have taken away a proposal for action and replaced it with a void. They have removed the prospect for any long-term action.
	I am afraid that that is all of a piece with the Government's actions. We have backed away from a referendum on the European constitution. We have backed away from a sensible outcome for public sector pensions. We have backed away on local government funding. I just hope that the Government back away from their proposals on terrorism, the one thing that they should back away from, but we see that the Prime Minister intends to remain obdurate.
	The Bill is silly. It will not get anybody out of a mess. The Government have exchanged what might have been a brief spurt of indignation for the certainty of five years of increasingly violent guerrilla warfare, which they cannot win and that will continue to gnaw away at them. It needs only one little old lady to chain herself to the proverbial railings, to turn up before the magistrates, and the Government will be right back in the syndrome. The issue is totemic. The Government cannot win because they have deliberately chosen not even to try.

Graham Stringer: My contribution will be short. When Albert Einstein wrote the general theory of relativity it was said that only three people in the world, including him, could understand it. Similar things were said when Isaac Newton wrote the "Principia". No such lavish claims have ever been made about the number of people who understand local government finance, although I suspect that over the years it has become so complicated—

David Davies: rose—

Graham Stringer: The hon. Gentleman may completely understand local government finance, and I   shall give way to him in a second.
	Local government finance has become so complicated and difficult that I do not believe that even the gurus in the ODPM completely understand it. Now is the time, with the review of form and function, when the system could be simplified, and I shall deal with those points in a minute.

David Davies: I wonder whether the vast majority of the population's lack of comprehension explains why Ministers do not seem to accept responsibility for the fact that council tax increases are a direct response to central Government policies and have very little to do with local authorities' behaviour?

Graham Stringer: The hon. Gentleman makes his point aggressively, but when the council tax was set up by a Conservative Government after the failure of the   poll tax, a large gearing effect was inherent in its structure because most of the money for local government came from central Government. The hon. Gentleman should not be quite so aggressive about a point that relates to the consequence of the Conservative Government's policies of 10 or 12 years ago.
	The issue before the House is relative simple. In a sense, one could say that one agrees with it or does not agree with it. It is whether the revaluation of council tax should be deferred and the power handed over to the Secretary of State to determine whether that should happen. If that were all that was being asked of the House, the answer should be no. The right hon. Member for Skipton and Ripon (Mr. Curry) made a perfectly good point, as did two Labour Members, for regular revaluations. My hon. Friend the Member for South Ribble (Mr. Borrow) said that the longer the revaluation is left, the more a property-based tax is undermined. What surprises me about the debate is   that   Labour and Opposition Members think that that is   necessarily a bad thing while the Lyons review is considering the functions and finance of local government. I do not necessarily think that it is a bad idea because the council tax was introduced in a panic after the Conservative party had politically assassinated a Prime Minister. The poll tax, which Conservatives introduced because they had failed to revalue the previous rating system, turned out to be probably the   most unpopular tax that this country had seen in the previous 200 years.
	The council tax itself was better than the poll tax—the community charge—but is it something that, 12 years on, Labour and Opposition Members should be going to the barricades to defend? I think not. That is why I   will vote in the Lobby tonight with my hon. Friends who sit on the Front Bench. If we were simply asked whether giving the Secretary of State the power always to determine when a property-based tax should be revalued was a good thing, I would say that, on its own, it was not. However, in the light of the Lyons review of form and function, it is just about justifiable to look at the situation 12 years after the council tax was introduced, after many changes have been made in local government structures and when some are still in the pipeline.
	I do not want to stray too far off the point—this relates to the Government's argument about why we should delay the revaluation—but at the bottom of the debate lies what we think local democracy's future is in this country. The simple answer, which is difficult to reach, is that local people in cities, towns and shires should be able to take decisions about the matters that they want to determine and that they can relate to, and they should be able to raise a lot of that tax locally themselves. We have got the balance wrong in this country, when only between 20 and 25 per cent. of tax is raised by the council tax, and when, if taxation is considered across the board, 2 or 3 per cent. of tax is the responsibility of local democracy.

David Taylor: My hon. Friend was a distinguished leader of one of the largest authorities in England before his election to the House. Is he satisfied about the direction of our local government policy? Local education authorities are being neutered. Social services are standing ready for absorption by the health service. Housing departments are being coerced into stock transfers. Are we living up to the ideal, which we espouse at election times, that we believe in local government? It seems difficult to judge, does it not?

Madam Deputy Speaker: Order. I am afraid that the Bill relates to the dates of revaluation of council tax.

Graham Stringer: Thank you for that guidance, Madam Deputy Speaker. I shall try, with your guidance in mind, to answer the question by relating it to the revaluation and the Lyons review of local government functions and finance. The reason for the delay is that if we want to comply with those principles—I share some of my hon. Friend's fears—the council tax, which was set up in response to the crisis of a Conservative Government, simply will not bear the weight of democracy.
	We should also remember in considering the revaluation that although our constituents get very excited about the council tax going up—I understand why and there is some unfairness in the system—I   suspect that the Labour party's communications and propaganda do not make enough of the fact that we are still paying 2.5 percentage points of our VAT more than we were paying before 1993 to pay for the mess of the   poll tax previously. I use that figure to illustrate the difficulties in using council tax, with its imperfections, as a basic tax to sustain local democracy. People in the streets are not angry that we are paying 17.5 per cent. VAT, rather than 15 per cent., but they are genuinely concerned about council tax because it increases year on year and a bill drops through the door. When Lyons looks at that, people's perceptions must be taken into account.

David Jones: Does the hon. Gentleman accept, however, that the people of Wales are extremely angry that they are being singled out to pay higher rates of council tax than those of equivalent property owners in England?

Graham Stringer: I do not know whether the hon. Gentleman was in his place previously, but if he had listened to what my right hon. Friend the Member for Greenwich and Woolwich said in reply to a similar point, he would have heard him explain that the decision on council tax was taken on a different basis in Wales to   raise extra money. That is not the Government's position. There is a difference, and we are not allowed to talk about that anyway, are we, Madam Deputy Speaker?
	The other issue that we should consider in deferring the revaluation of council tax is its efficiency. People have been very careful and accurate to describe the council tax as a property-based tax. Of course, it is a property-based tax, but it also has an element, which is left over from some of the thoughts on the poll tax, that is related to the number of people in the household. People are entitled to a 25 per cent. discount if they live on their own. Although this might not be completely fair, I have collated two sets of statistics on the matter, which indicate that there is a problem with the council tax and its revaluation.
	Some 3.5 million people are not on the electoral register. It is my contention—I have some evidence for this—that a large percentage of the people in my constituency who are not on the electoral register are avoiding paying council tax. When we consider the revaluation of council tax, it is important to know how many people pay it and how many others are ever likely to pay it. I have checked the situation regarding the houses in one of my inner-city wards. It turns out that there is a ratio of two women to one man, but if one walks around the streets of that polling district, one realises that the ratio is 50:50. The conclusion is fairly obvious: a certain degree of council tax evasion is going on, which the Electoral Commission has picked up through its study of how many people have not registered on the electoral register. If we are considering deferring the revaluation, we must look at the basic efficiency of the council tax. It is considerably more efficient than the poll tax, but not as efficient as the domestic rates were.
	I know that you will not allow me to stray on to the functions of local government, Madam Deputy Speaker, but local government has shrunk. Parts of it have been pushed into quangos such as learning and skills councils and regional development agencies—Conservative Members probably have a list of them. The Conservatives were responsible for some such quangos and this Government have been responsible for others. We must consider not only the weight of democracy that the council tax can support, which is not that much, but the democracy that it should support. Given the two contradictory problems of the inefficiency of the council tax and the fact that little of it is determined locally, and what I would like to see coming back to local government, I am happy to support a deferral of the revaluation of council tax because it will be no friend to that property-based tax. I hope that Lyons will understand such things and look at the problem thoroughly, instead of just taking instructions to say that we should strip so much out of local government and destroy more local democracy because that is all that council tax will bear.
	The hon. Member for Brentwood and Ongar (Mr.   Pickles) did some knockabout stuff at the beginning of the debate, which was understandable in a Second Reading debate—some of it was quite witty and   funny. However, the Conservatives changed their policies on local democracy, which were disastrous in the late 1980s and 1990s, so all of us should try to reach a consensus on finance and function in local democracy. I say in all sincerity to Conservative Members that we should treat the deferral of the revaluation of council tax as a serious opportunity.

Paul Beresford: We have heard several thoughtful speeches—the last two were good examples. It must be accepted that there is no outcry, with the possible exception of two Labour Members, in support of a national revaluation. However, my right hon. Friend the Member for Skipton and Ripon (Mr. Curry) pointed out that there are local cries for revaluation, which I accept, so I thought that I   would try some lateral thinking about that. My right hon. Friend and I used to take that approach in a little office down the road when we discussed such matters previously. Today, however, I want to use the reasoned amendment as a way to look for a slightly different approach.
	Although the council tax is a property-based tax, we must remember that it is not actually based on property values in the same way as business rates or the domestic rates. The slightly different approach behind the council tax has two effects. Valuation is used to put properties into bands through which the tax is distributed locally. Importantly, especially for people in the south-east, such information is used by the Government in their assessment of ability to pay when grant is distributed, which has led to a dramatic shift of grant from the south-east to northern urban areas since the new system was introduced.
	We should be able to think about a slightly different approach. It would be sensible enough to accept the Government's proposal to delay—perhaps completely—a national revaluation. However, we should also set the situation legally so that the Secretary of State could allow   regional authorities—if we end up with regional authorities, heaven forbid—or at least the taxing authorities to reflect any dramatic changes that might occur in their areas. We could thus go for localised revaluation. I cite that specifically in response to the point made by my right hon. Friend the Member for Skipton and Ripon that there are areas—the Thames Gateway will probably be a classic example—in which huge amounts of building will occur, so revaluation due to the sale of such properties would obviously be appropriate, and perhaps necessary. That might mean that the value of the bands in such areas would shift.
	The major effect of the council tax that we must consider is the fact that the Government mistakenly base ability to pay on the value of properties. That is why a national revaluation could have a dramatic effect on the south-east and London, while being positive for council tax payers in the north-east and the north in general. Using slightly lateral thinking to find a different approach, albeit perhaps from a rusty base, I think that we should be considering a different way of judging ability to pay.
	An obvious approach would be for the Treasury to produce each year a borough-by-borough estimate of individuals' income throughout the country. That assessment could be a substitute for the valuation bands   with which we currently judge ability to pay and grant distribution. Such an assessment should be complemented by a system to assess people's cost of living. Part of the cost of living, especially in London and the south-east, is dependent on the value of properties because of the size of their mortgages. That factor should be reflected when the grant from central Government is calculated, but it is not.
	I support the Government in one aspect because the delay will create the opportunity for more radical thinking than Sir Michael Lyons would have been likely to achieve without the Bill. I support the reasoned amendment because we must move away from a national revaluation of properties that are not business properties because of the reasons that I have outlined. I   especially support my Front Bench colleagues because I have deep concern, contrary to the view of my right hon. Friend the Member for Skipton and Ripon, about the proposal to create extra bands instead of changing the valuation of the existing bands, because that would shift dramatically the proportion of grant allocated throughout the country, which could cause damage.
	So, I half welcome what the Government are saying but more particularly I welcome the approach taken in the amendment, because it gives us a chance—I suspect that the Government will not accept it—to come back with the product of a slightly deeper re-think than what my right hon. Friend the Member for Skipton and Ripon has described as a grubby little Bill.

Celia Barlow: Members on both sides of the House are aware of the importance of a good relationship between people and their local authority. Like many Members here today, I seek improvements to the system that will not only enable a more efficient collection of funding and delivery of local services but strengthen the relationship between local councils and their stakeholders.
	During this year's general election campaign, I read with interest and not a little disbelief the Opposition parties' proposals for collection and for reforming the   council tax system. The Conservatives proposed the   postponement of revaluation and promised simple council tax cuts which were unaffordable and would lead to an inevitable loss in service provision. The Liberal Democrats, who now say in the House that revaluation would be a waste of time, offered a local income tax system which would be expensive to run and would penalise hard-working people across the country. Two contrasting proposals—one irresponsible, the other unworkable.

David Howarth: If the local income tax system is unworkable, why does it work in Denmark and the United States?

Celia Barlow: The circumstances of the local income tax, as outlined in the Liberal Democrats' proposals, were unworkable.
	The system is in need of reform. I am aware from correspondence and conversations with my constituents that a growing section of our population feels that a more equitable means of funding local government is needed—not just revaluation. That Opposition parties have been unable to capitalise on that sentiment for electoral gain demonstrates the sensitivity with which the electorate view this subject. People want real solutions based on considered inquiry.
	Those points show that we can do better. Now is not the time for tinkering around the edges of council funding. We stand at the beginning of a new Parliament—time enough to investigate thoroughly the many ways forward, to listen to the needs and aspirations of all concerned parties, and to present to the people a bold, more equitable future for local government.
	I have been contacted, as I know have a number of Members present, by the IsItFair campaign group. Its proposal to scrap local taxation and to replace it with higher centrally collected VAT and income tax would be a disastrous move in the wrong direction.

Madam Deputy Speaker: Order. May I remind the hon. Lady that we are asked to confine the debate today   to the Bill before us, which is about the dates of   revaluation of council tax rather than local government finance?

Celia Barlow: I thank you for your guidance, Madam Deputy Speaker. The challenge that we are faced with today is not just revaluation or re-banding but how to bring local councils closer to the people they serve.

Mark Pritchard: The hon. Lady has clearly thought through her speech; it is a measured speech. I am interested in her comment about equity. Does she think that it is equitable that as a result of revaluation in Wales 33 per cent. more homes are paying more? Is she in favour of revaluation?

Celia Barlow: I understand from guidance from Madam Deputy Speaker that we are dealing with matters in England rather than in Wales.
	In the south-east of England—

Madam Deputy Speaker: Order. May I clarify matters? A passing reference to Wales is acceptable. What cannot take place is a whole speech referring to Wales, because this Bill and revaluation do not affect Wales.

Celia Barlow: Thank you, Madam Deputy Speaker.
	If I may return to England, in the south-east and in my local authority of Brighton and Hove, revaluation would have done little to redress inequalities without an accompanying restructuring of bands. According to housing statistics published by the Council of Mortgage Lenders and the Office of the Deputy Prime Minister, between 1992 and 2004 house prices in the south-east rocketed by 210 per cent., while average earnings of mortgage borrowers increased by only 93 per cent. Meanwhile, in the north-east of England, for example, house prices went up by 167 per cent. and earnings by 83 per cent. Therefore, the gap between house prices and earnings is widening across the south-east.
	While it is increasingly difficult for younger people in my constituency to get on to the property ladder, there is great concern among older people about council tax increases. The burden of council tax is higher for pensioners than for many other households. The council tax benefit system is a great help for them, but many who are entitled to the benefit still do not claim, and most of those are pensioners. Therefore, we need to look at the operation of the council tax benefit system as well.
	We need not just to revalue but fundamentally to rethink the way in which local government is funded. That is the only way to revolutionise people's relationship with their local council and to increase the effectiveness of local service delivery. Some good and imaginative work has already been done, adding greatly to the debate. I read with interest the paper written by my hon. Friend the Member for Southampton, Test (Dr. Whitehead), which outlines proposals showing the   potential for local revenue collection. Some contributions add to the ongoing deliberations on the Labour Benches on how to be equitable with tax collection yet fair to economically vulnerable members of our communities—pensioners in particular. Unlike the opportunistic approaches demonstrated by some Opposition Members, those meaningful contributions demonstrate the potential for improving the relationship between people and their local councils, as opposed to driving a wedge still deeper.
	I support the call of my hon. Friend the Member for South Ribble (Mr. Borrow) that if there is a revaluation it should not be too far in the future. However, I also voice my support for Sir Michael Lyons' review process, especially now that his remit has been extended to include the future of local government in a wider context. This is a one-off opportunity to look afresh at the situation and to offer the people of this country a bold new vision of local government and service delivery. That vision has the potential to be fair to the regions as well as to local communities, in addition to fostering a more equitable relationship between local councils and the communities that they serve.

Maria Miller: I welcome this opportunity to speak about council tax, because the issue is causing immense concern in my constituency. I   speak for many Basingstoke families and pensioners who face staggering increases in council tax as a result of the actions of this Government. Those families and pensioners would face almost untenable costs if the Government implemented their intention to revalue, so I support scrapping revaluation in its entirety.
	We are told that the proposal is revenue-neutral, but the actions towards householders in many other aspects of our lives suggest that the cynicism expressed from Opposition Members may be justified. If I may, I shall look at this issue from a slightly different angle—from that of our constituents. A house is a home where we raise our families and live our lives. If we are fortunate enough to own our own home, our families are offered a certain level of security. This Government are using our homes as another way to punish hard-working families for doing the best for their children and to punish pensioners in their retirement.
	House price inflation does not deliver an additional income to householders. It does not put an additional   pressure on local services, and as we have heard today the relative level of house prices has not changed regionally for a decade. Under this Government, house price inflation has been seen as an opportunity for an additional back-door tax on pensioners and hard-working families. Council tax revaluation is just the latest in a long line of such measures.
	The Government are happy to recognise an increase in property values when it comes to council tax, but not when it comes to inheritance tax. They have continually failed to raise inheritance tax thresholds to reflect house price increases, and in the process have added about a £1 billion tax take to the Chancellor's coffers. Under Labour, stamp duty has tripled in my constituency, with the stamp duty bill for an average detached house being almost £4,000. In Basingstoke, stamp duty is slapped on even the average flat that would be within reach of a first-time buyer. One in three children aged 10 today will be able to own their own home in the future. Contrast that with the last Conservative Government, who helped 2 million people get on the housing ladder under right to buy. The Government have declared war on our home owners of the present and the future.
	Delaying revaluation will leave the sword of Damocles hanging over the heads of pensioners and families who have already been penalised enough for doing the right thing, working hard to provide a safe and secure environment for themselves and their families. The Government have tried to paint a different picture and claim that revaluation will be revenue neutral, but that assertion has been blown out of the water by what has happened in Wales, as we have heard today.

Paul Beresford: The trick with the Government's claim that revaluation will be revenue neutral is that nationally, it probably will be revenue neutral, but it will be to the disadvantage of my hon. Friend's constituents and to the advantage of those in the north because of the way in which the ability to pay assessment uses the shift within the banding. She is right. It is another case of the Government hiding the effects and leaving local government to take the blame.

Maria Miller: My hon. Friend makes an excellent point. In areas such as my constituency in north Hampshire, where we have seen house prices increase by 13 per cent. more than the regional average, we will be waiting for tax hikes of around £300 per household, taking the average council bill to well over £1,500, which many of my constituents cannot afford.

Brian Binley: On the total tax take, as opposed to the vehicle for collecting tax, does my hon. Friend agree that the Government have deliberately forced up the total council tax take? Had they not done so, we would not have had anything like the recent problems with the collection system.

Maria Miller: My hon. Friend makes an excellent point. With council tax increases of over 70 per cent., it is not surprising that people are uncomfortable with the current situation.
	If more evidence were needed—not that I think it is—that revenue neutral arguments can be less than honest, perhaps we should consider the business rate revaluation. The Government said that that was aimed not at changing the amount of money collected nationally, but at ensuring that individual rateable values reflected the changes that have taken place in property markets since the last revaluation in 2000—very much the arguments that have been rehearsed today.
	However, the business revaluation hiked taxes on local firms by more than £1 billion a year across the country, pushing up average firms' bills by three times the rate of inflation. In Basingstoke, which is one of the most important hubs of business and enterprise in the   south of England, the average bill paid by local firms has risen by 6 per cent. to over £16,000 a year, despite the Government's claims that the business rate revaluation would be revenue neutral. Almost 2 million businesses across England were sent revised business rates in April. That money will not be kept by local government, but will be snatched back by central Government. Higher taxes on local firms will damage the economy and increase the prices in our shops. Our experience to date is that re-banding is no revenue-neutral balancing exercise, as suggested by the Government today.
	There are more deeply rooted reasons for the Government's climbdown on revaluation, which some of my hon. Friends have touched on. It is a symptom of a growing realisation of the crisis in local government finance. We have noted the fact that we are paying over 70 per cent. more in council tax under the Government, analogous to 3 per cent. on income tax. But those accountable to the voters at local government level have little control over council tax levels for which they are judged at the ballot box, despite what the Minister said in an Opposition day debate only a few weeks ago. The Government have in essence broken the link between taxation and representation, with 75 per cent. of local government spending coming from central Government and only 25 per cent. from local council tax payments.
	For many councils, the cost of providing additional statutory services outstrips the funding that they receive from central Government. My constituency is in the county of Hampshire, designated excellent by the Government for its levels of efficiency. I agree with that. Hampshire has achieved great savings over a number of years in response to the pressure under which it finds itself, but this year the sums simply do not add up. In 2006–07 the projections are that, after the Government have ring-fenced the revenue support grant into the new dedicated schools grant and removed the one-off grant support designed to keep council tax figures low in a general election year, Hampshire will see a 1.7 per cent. increase in Government grant, yet it needs an increase of 5.4 per cent. to finance the Government's local spending plans and maintain current levels of service. This means that my constituents are facing a further 8.4 per cent increase in council tax, on top of the vast rises in recent years under the Labour Government.
	If the council is not allowed to put such an increase in place, the result will be cuts in services to the tune of £8 million, according to current projections. That would mean 130 fewer residential care places for elderly residents; 200 fewer day centre places for adults with physical, learning or mental health disabilities; 150 fewer children in full-time foster placements; and   further backlogs in road maintenance, despite continued pressure from the South East England regional assembly to increase house building.
	We are at the tipping point. The people of Hampshire, along with many thousands of other residents throughout the country, are paying more and getting less. Revaluation, whenever it came, would make the situation even worse. We heard earlier that the situation is particularly perilous for pensioners. In my constituency a third of their basic state pension is taken up by higher council tax payments, which is unacceptable.
	We do not need the revaluation at any time. We need tangible support for pensioners, as I have mentioned before. I will continue to campaign for the 50 per cent. discount that I highlighted in the general election campaign, and for the reinstatement of the link between local taxation and local accountability. We must call a halt to the Government's war on home owners by stopping once and for all the measure being debated today.

Alan Whitehead: We have a rather bizarre debate. On the one hand, the Government are introducing a Bill to postpone revaluation, while stating that they want revaluation to take place. I hope that revaluation is postponed, rather than cancelled or kicked into the far-distant long grass, because it is an important part of continuing with a property-based tax. The Government are changing the 2003 Act in order to retain revaluation. The Opposition, on the other hand, have tabled a reasoned amendment opposing Second Reading, which would simply cause the revaluation to go ahead.
	If Conservative Members vote for the Opposition amendment tonight, they will vote for revaluation. There is no point in their shaking their heads: if Labour Members decide to go home rather than vote in the Chamber tonight and the Conservatives by some mischance win the vote, the relevant section of the Local Government Finance Act 1992, as amended by the Local Government Act 2003, will stay in place and revaluation will go ahead. Furthermore, no one can stop revaluation going ahead in those circumstances because the provision is on the statute book.
	Conservative Members must be careful. My party does not do this kind of thing, but if a "Focus" leaflet were produced stating, "Local Conservatives vote for revaluation", it would be perfectly fair. "Focus" leaflets are not always fair, but the example I have described would be. Conservative Members, who are looking rather glum, would be well advised to get their own statement out explaining the true reason why they voted for a revaluation that they do not want.
	The Conservative party does not want revaluation—not now, not ever—and it has boxed itself in by stating that it will cancel it. The hon. Member for Brentwood and Ongar (Mr. Pickles) made an extremely strange comment to the effect that he does not mean "not ever", but, because property prices have converged, there is not a circumstance under which revaluation is necessary. If property prices were to deconverge, the Conservative party would presumably review its policy, but let us take its position on cancelling council tax revaluation as being fairly firm.
	In its local government manifesto in spring 2004, the Conservative party said that it will not introduce any new or higher bandings, so it is boxed in on revaluation and the present bandings. It has said that banding would be the only way in which local government could raise money under a Conservative Government, because it will block taxes other than council tax from entering the   local government arena. It also made it clear in its local government manifesto 2004 that it is against local income tax and any other form of transfer tax, so it favours one unchanged, unre-banded tax based on 1992 property values, which is a strange policy.
	One of the problems with the Conservative policy of not re-banding is that, as other hon. Members have said, a council tax base that is not revalued will drift further and further away from actual property values over a period of time. The Conservative Opposition want to enter government with a tax that progressively bears less and less relation to the actual value of property. If one were cynical—as I have said, that is not my position—one would say that that policy would serve some people rather well, because, assuming that house prices continue to inflate, as taxes drift further and further away from real property values, so a larger and larger number of people will be in a band in which no one pays any more council tax, regardless of increases in property values. Perhaps the thinking is driven by the political party that people in those bands tend to support.
	As a method of securing a flat tax that is unrelated to real value—we have heard about flat taxes in recent European elections—the Conservative proposition may be interesting, but in reality the situation is more complicated than that. Over a period of time, high property prices will mean not only that the highest band fails to differentiate between properties in certain parts of the country, but that different sets of flat taxes apply in different parts of the country, because property values will continue to rise at different rates.

Mark Pritchard: The logic of the hon. Gentleman's position seems to be that as people become more asset rich, the Government should say, "We want some of your assets." We have not heard Labour Front Benchers, Labour Back Benchers or Liberal Democrat Members discussing efficiency in public services and people having more through better spending. All we have heard is that the Government want to tax people more, if people's property increases in value. People pay enough tax as it is, including increasing sums of inheritance tax as property prices increase.

Mr. Deputy Speaker: Order. Probably one of the reasons why we have not heard that argument is that it forms no part of the Bill. I hope that   the hon. Member for Southampton, Test (Dr.   Whitehead) will not go down that line.

Alan Whitehead: I have no intention of going down that line, Mr. Deputy Speaker.
	The Conservative party wants to keep the council tax in its original, unformed, half-baked, semi-organised form, which resulted from the panic in 1992 following the poll tax. The hon. Member for The Wrekin (Mark   Pritchard) appears to be adding another string to the bow of that crude and unformed tax by saying that he is pleased that it does not seek to reflect the value of property. When the Conservative party introduced the council tax, however, it introduced bands to reflect the difference in property values.
	Incidentally, the 1992 council tax legislation did not include a revaluation provision because it was widely believed at the time in Government circles that placing the bands on the statute book and maintaining council tax within them would remove the need for valuation, because property price movements would be absorbed by movements within the bands. Over time, that thinking has proved to be hopelessly and ridiculously off target.
	The hon. Member for The Wrekin appears to be saying that revaluations should not take place within the council tax system. As properties rise in value, however, so council tax should levy a tax on a fair and equitable basis across the bands, reflecting property price increases. It is not a question of taking more money from particular houses; it is a question of taking the right amount of money from particular houses.
	I shall illustrate the problem of the way bands work in different parts of the country by briefly considering two boroughs, one of which is in the south of England and is not ridiculously rich, and the other of which is in the north of England and is not especially deprived. An examination of which houses are in which bands illustrates my point.
	The London borough of Merton has 8,391 properties in bands A and B and nearly 10,000 properties in the top three bands. The borough of Wakefield, which is 80 per cent. larger in terms of total number of properties, has 1,882 properties in the top three bands—a fraction of the number in a much smaller borough in London—and 97,000 properties in bands A and B.
	The geographical differences in banding around the country are already enormous. Given that property prices are drifting upwards, if there was no revaluation that differential would remain in place and continue to widen. In the case of boroughs with a larger number of properties in the top bands, the number of properties that would jump into the top bands would be considerable, thereby creating a flat tax effect. As my right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford) said, those in the lower bands would not gain any credit from that, because it is not possible to go below the lowest band. The flat tax effect works at the other end as well.
	The consequences of the Conservatives' rather strange position can be clearly spelled out, but another party is involved in this debate—the Liberal Democrats.

Brian Binley: I am becoming rather confused. Does the hon. Gentleman want the Government to proceed with revaluation earlier than they intend, or does he think that they should do it after the next election?

Alan Whitehead: The hon. Gentleman will have to wait to hear my full exposition. To put him out of his misery temporarily, I am happy to say that there is a case for bringing a wider review of Government functions into a process of revaluation. We could therefore postpone revaluation for a limited period, but not do away with it completely. That is the contrast that I was seeking to make between the position of hon. Gentleman's party and that of my own, which I will of course support in the Lobby.

Paul Beresford: There is a slight flaw in the hon. Gentleman's argument. The fact that the council tax banding system relies on valuations has an effect within a local area, the other effect being on the distribution of grant. If one changed the ability-to-pay aspect of the grant assessment, the argument of my hon. Friends on the Front Bench would stand.

Alan Whitehead: The hon. Gentleman made some interesting and thoughtful remarks about maintaining the position of council tax as a prime tax for local government—there are many reasons why that should be so—without some of the toxic side effects that continue to be associated with it. However, his views contrast significantly with the official position of his Front Benchers, which is to do nothing whatsoever and keep council tax exactly as it is.
	Interestingly, the Liberal Democrats propose to vote with the Government. I am delighted about that, but they are doing so from an entirely different perspective. In a debate that took place a little while ago, I suggested that the policy set out by the hon. Member for Brent, East (Sarah Teather) could be compared to Chairman Mao's great leap forward. In 1918, Lenin said that he supported the then Labour leader, Arthur Henderson, like a rope supports a hanging man. It seems that the Liberal Democrats plan to support the Government tonight because they do not want a revaluation in 2007, or ever. They want something entirely different—a local income tax.
	We do not want a long discussion about local income tax because that is not what we are here for. However, it is widely recognised that it would be impossible for 434 billing authorities to attempt to collect a local income tax that is levied at a different rate from the national rate of income tax. Some people would be resident within the geographical area from which the tax is being levied, some would not be resident, and some would be sometimes resident and sometimes not.

Mr. Deputy Speaker: Order. The hon. Gentleman said that we do not want a long debate on local income tax. We do not want a short one either, as it is out of order.

Alan Whitehead: Thank you, Mr. Deputy Speaker. I   shall have to see my Liberal Democrat colleagues outside to finish that discussion. The hon. Member for Brent, East said that she wished for a restitution of local control to local government. A system for revaluing the   council tax or any form of tax that would have to be collected nationally does not appear to be in line with restoring a great deal of local interest to local government.
	Several hon. Members made thoughtful and interesting contributions on the central issue of what to do about local council tax in terms of revaluation and whether the tax works as a way of collecting moneys from local residents in order to pay for local services.
	One of the conundrums that has bedevilled local government is that the tax demand thuds on the carpet in April in the form of a notification to pay. Many people perceive that it comes their way after they have paid all their other taxes. The hon. Member for Basingstoke (Mrs. Miller) reflected some of that feeling when she said that people believe that they have paid all their taxes when another demand appears. If, instead of collecting VAT from the general population as they made their purchases—

Mr. Deputy Speaker: Order. I sense that the hon. Gentleman is going astray again. The measure is about the postponement of revaluation in England and the hon. Gentleman must keep within the terms of what is—God knows—a short Bill.

Alan Whitehead: I take your guidance, Mr. Deputy Speaker.
	People's perception of council tax is important to deciding what we do about revaluation and banding. As Labour Front Benchers have said, deferring a decision about revaluation perhaps affords an opportunity to provide a wider context in a review of council tax revaluation and a wider debate about the purpose of local government.
	The right hon. Member for Skipton and Ripon (Mr.   Curry), who is unfortunately not in his place, made a thoughtful contribution. Although he would not put it in the same words, he suggested that there are methods of making council tax work relatively well. He also said, in contradistinction to Conservative Front-Bench Members, that that would entail revaluation. He said that several other things could be done to make council tax revaluation part of the process rather than, as several hon. Members have described it, an apparent obstacle to it.
	Governments throughout history have been concerned with the effect on the winners and the losers of revaluation and have thought long and hard about the subject. The right hon. Member for Skipton and Ripon asked whether other things could be done to place the workings of council tax generally in the context of revaluation. Several ideas could be considered and I hope that, if the Bill is passed, my hon. Friends on the Front Bench will examine them in the context of the extended Lyons review, alongside revaluation.

John Bercow: If the hon. Gentleman were a lawyer and paid by the word, he would have made sufficient funds by now to retire. However, I am genuinely interested in his comments. What assessment has he made of schedule 7(52)(4) of the Local Government Act 2003? It is germane to our discussion because it relates directly to clause 1(7), on which, I know, he wants to focus.

Alan Whitehead: The hon. Gentleman makes an important point, but if he examines those subsections carefully, he will find that, unlike his belief, they are not closely connected.
	I was about to concur largely with the right hon. Member for Skipton and Ripon about making council tax work. That is an important element that we need to consider when we examine revaluation.
	Much of the debate has been about bands, including whether we need new bands at the top or at the bottom, whether we should retain existing bands and whether revaluation, which would re-band properties, leads to higher council tax. Hon. Members have commented on the fact that, unlike in Wales, rebanding in England could be revenue neutral, if one provided for circumstances in which that could be achieved.

David Jones: The hon. Gentleman mentions revenue neutrality. However, is not it the case that revaluation was presented as revenue neutral to the Welsh Assembly?

Alan Whitehead: It has already been suggested that we should not stray into matters that concern the Welsh Assembly. However, the revaluation in Wales did not   proceed on the basis of a nil additional yield. Revaluation in the UK could be based on no additional yield.

Maria Miller: It might be useful to remind the hon. Gentleman about the business rate revaluation, which was also supposed to be revenue neutral but was not. Perhaps he could make a few comments on that.

Alan Whitehead: As the hon. Lady knows, the business rate revaluation has been based on its being followed by dampening mechanisms to take account of the differences in the way in which the rate works in various parts of the country. When there is a transition in value between various parts of the country, the dampening mechanism works to a better or lesser extent in different places to equalise as far as possible the effect of the   revaluation over a period of time. However, if a dampening mechanism is introduced, it cannot necessarily ensure that there is no difference in yield because it works differently in different parts of the country, depending on the change that has occurred in   the revaluation. A revaluation with a dampening mechanism cannot give a revenue-neutral, guaranteed yield in the way that the Government suggested could be done for council tax revaluation. I am sure that the hon. Lady has been greatly enlightened by what I have just said.
	When we consider bands and whether we need new ones, I want to ask whether we need them at all. The previous Conservative Government introduced bands in the Local Government Finance Act 1992. They were prepared in something of a hurry, on the erroneous understanding that they would ultimately get rid of revaluation. I believe that a system of points would be a fairer and better method of valuing properties than the current bands system. We would not then have the   worry about moving between bands.
	Points would be given on the basis of a specific valuation. As we have heard, the Institute of Revenues Rating and Valuation has said that, if revaluation were to proceed, it would provide an individual valuation for   each property. It would thus be relatively straightforward to move from individual valuation to a series of points rather than placing properties in a band. The total number of points that a local authority had would form the basis on which council tax could be levied. That would provide considerable certainty about the amount of money available for the local authority to levy council tax as part of its budget-making activity.
	Such a system would also mean, if combined with a change in the way in which councils set their council tax, that there would be no gearing effect. If, for example, one were to introduce a marginally variable core grant at the beginning of the process, set the council tax on the basis of points rather than bands, then compensate at the end of the process, one would simply not have the gearing effect. The way in which the settlement was brought about would effectively remove much of the concern about that effect.
	The right hon. Member for Skipton and Ripon and the hon. Member for Brent, East both mentioned proposals to localise the business rate. It has been suggested that that should happen because it would introduce a greater degree of autonomy to councils in terms of the decisions that they make about their finances. If there were no gearing effect, however, that would be of less significance. However, the right hon. Member for Skipton and Ripon rightly pointed out that since the business rate was introduced, with the intention that it should not be levied at above the rate of retail price inflation, the percentage of funding into the local government stream that the business rate has provided has gone down from about 27 per cent. to 22 per cent. If we had historically pitched the level of the business rate against increases in earnings rather than in prices, it would have been possible more or less to have kept up that proportion over a period of time. If we prospectively pitched the business rate against earnings rather than prices, it would re-equalise that proportion over time, so that it would continue to operate on a level basis, rather than falling continuously against the total proportion of moneys raised for local government and against the amount raised by council tax. That would resolve another problem.
	There are a number of measures in the Lyons review—or associated with it—that the Government could consider in the context of revaluation, over and above whether we revalue or not, which would bring back a council tax whose operation was significantly refreshed. That is the potential prize that lies ahead of us, assuming that we consider that council tax should continue to be the main device whereby local tax is raised. If, as a result of this process, we achieve a council tax that reflects more marginally on people's concerns about the tax bill landing on the carpet, that relates more fairly in terms of its effects on the rise of property prices and to the actual amount that people pay, and that is in line with the way in which the business rate works, we will have done a good job, so far as temporarily suspending the revaluation is concerned. If the tax comes back refreshed in that way, the question of revaluation will play a part in the process but it will not form most of the process. That would be a positive outcome from a decision that people in some quarters are calling a U-turn, and it could result in something good for future local government.

David Howarth: It is a great pleasure to follow the hon. Member for Southampton, Test (Dr. Whitehead). I agreed with many of the points that he made at the beginning of his speech. Sadly, I did not agree with what he said about local income tax, but it seems that we shall have to take up that debate on another occasion.
	Two aspects of this debate are quite bizarre, one of which the hon. Gentleman mentioned. That was the fact that it seems very difficult for hon. Members to stick to the point of the debate. One reason for that is easily explained: it is difficult to separate valuation from the rest of local government finance. Some reference to those other matters is necessary in order to understand the decision that we face tonight.
	The other point is fascinating, and relates to the internal debate on the two sides of the House. It became increasingly difficult to tell whether a speaker was speaking from the Conservative side of the debate or from the Government side. A serious point lies behind that difficulty as well. There are inherent difficulties with the council tax, and both sides are finding it difficult to come to terms with that. It is the most regressive major tax in the Government's taxation armoury. Indeed, it causes the whole taxation system to be regressive: the top 20 per cent. pay less tax overall than the bottom 20 per cent. of the income distribution. We all have constituents who face extraordinary council tax bills. I   have one who has to pay 10 per cent. of his income in council tax, which is an extraordinary figure. This leads to the conclusion that we have reached, which is that the whole council tax system ought to be abolished and replaced by a different system.
	My own position on the Bill is simple, and the hon. Member for Southampton, Test got close to identifying it. For me, revaluation is a pointless and expensive exercise that should be scrapped. It is pointless because the council tax is inherently unfair and should be replaced by a better tax, namely local income tax. It is expensive because it has already cost about £60 million and is likely to cost another £100 million, if not more. Those resources would be much better spent on almost any other aspect of local government expenditure. The Bill means that the Government will be in a position to   call off this wasteful and pointless exercise, and I   therefore support it in principle. I would, however, like to see some changes made to it in Committee, and I   shall mention at least one of them later.
	First, however, I want to challenge the Conservatives' position on the Bill, which is puzzling. Their amendment says that the House should decline to give the Bill a Second Reading because it does not cancel the council tax revaluation. However, as the hon. Member for Southampton, Test said, we all know that the Government will use the power that the Bill will grant to call off the 2007 revaluation. The current law is clear: there is an obligation to hold a revaluation in 2007 under the terms of the Local Government Act 2003. If the Bill were to be defeated tonight, therefore, that would remain the law and the 2007 revaluation would continue.
	The Conservatives' position is puzzling in another way. I differ from the hon. Member for Southampton, Test, at this point, because the Second Reading debate of the Bill that became the Local Government Finance Act 1992 shows that it was always thought that revaluation would be necessary at some point under the council tax system. That Second Reading debate makes fascinating reading, and I recommend it to all hon. Members, especially for the remarks by Labour Members who were in favour of something called "fair rates"—a concept that seems to have disappeared completely—and for the views of the right hon. Member for Sheffield, Brightside (Mr. Blunkett) and the then Member for Dagenham, who held fascinating views on the invasion of privacy that would result from the introduction of the council tax valuation system.
	Nevertheless, little was said in the 1991 debate about the revaluation issue, except in so far as Conservative Members said that the need for revaluation was a serious problem in the old rating system and would also be a problem in the fair rates system. That problem would not be eliminated under the council tax, however, but simply reduced. The then Secretary of State for Scotland, Mr. Ian Lang, in the debate on Tuesday 12 November 1991—a Second Reading debate that was held over two days, which I have yet to see in the House in my time, although perhaps it is not necessary for this Bill—stated:
	"The banding system irons out much of the effect of relative changes in property values within an area which, under the rating system, brought regular pressure for revaluation. The need for general revaluations is therefore much reduced. If, however, such a revaluation were required, say, 20 years hence, the same house in band D would probably remain a band D house, provided that its relative position within the range of property values had not changed so much as to take it outwith the new parameters for that band."—[Official Report, 12 November 1991; Vol. 198, c. 918.]
	Council tax does not therefore eliminate the need for revaluation, but merely reduces it.
	The then Conservative Government expected to have a revaluation in around 2011, only four years later than that provided for in the 2003 Bill. The puzzle in the Conservative position is that if clause 1 of the Bill that we are considering tonight had been included in the 1992 Act, no one would have turned a hair. It would have been perfectly compatible with the policy of the   then Government. We have heard tonight that Conservative policy now is that there must be primary legislation every time a revaluation is suggested. No one said that in 1991. It strikes me as somewhat over the top to require primary legislation for what would in effect be a one-clause Bill, as opposed to a positive resolution of the House under the current arrangements.
	Let me turn to the one aspect of the Bill that requires further attention. Hon. Members have referred to the difficulty that politicians have in bringing to fruition revaluations of property-based or near-property-based tax. The technical reasons for introducing such revaluations have been well explained, especially by the hon. Member for South Ribble (Mr. Borrow). They are related to divergence in property values. The relevant divergence is at the individual property level, not at the district or regional level. Those technical advantages of revaluation, however, are always outweighed by the political cost. Ministers of whatever party find it impossible to revalue without paying a very high political price.

John Hemming: As an ex-leader of Cambridge city council, my hon. Friend will be aware that the political cost of the council tax has been substantial over time. Part of that has been caused by the continuation of the Conservative Government's policy of increasing council tax by more than inflation. At standard spending, in 1993–94 council tax was £492.66, and in 2002–03 it increased to £769.16. It then changed to the assumed national council tax, putatively £1,000.83, which has increased to £1,101.96. That is a 71.9 per cent. increase in council tax, while inflation has been 34 per cent.—

Mr. Deputy Speaker: Order. I cannot see how that has any relevance to the Bill.

David Howarth: Thank you, Mr. Deputy Speaker, for saving me from having to reply to my hon. Friend's intervention. I, too, found it difficult to see its relevance to the Bill, although he made a good point.
	As I was saying, the problem with revaluation is that its technical merit is almost always outweighed by its political cost. As the hon. Member for Southampton, Test said, that does not bother those of us who are in favour of scrapping the entire system and replacing it with a completely different local government taxation system. In fact, it makes our case better. As the lack of revaluation makes council tax increasingly anomalous and unfair, more and more people will come to see the good sense of our alternative proposals. I suppose that one could say that we were following the rule of worse is better.

Tom Levitt: Does the hon. Gentleman recall that, in the last general election, the Liberals had a website into which people could tap numbers to find out whether they would be better or worse off under their local income tax? I have not met anyone who found that they would be worse off. The reason for that is not the goodness of the system but the   crazy way in which the website worked. The website did not ask what band—

Mr. Deputy Speaker: Order. If the hon. Gentleman had been present for a larger part of the debate, he would realise that that remark is totally out of order.

David Howarth: Thank you, Mr. Deputy Speaker.
	As I was saying, the problem with revaluation should bother the two parties in the House that are in favour of a property tax. The need for revaluation cannot be denied by those who favour that sort of tax. It never has been denied from the Conservative Benches until recently. My problem with the Bill is that the proposed mechanism allows the Secretary of State a bare discretion to refuse to revalue in any particular year or for ever, so the political reasons for failing to revalue always outweigh the technical reasons. That lacks fundamental transparency.
	I ask the Government to consider an amendment to the Bill that would do the following things. First, the Secretary of State should have a duty from time to time to consider whether he should use the power that the Bill grants him. Secondly, when considering whether to use the power, he should be under an obligation to give reasons as to why that power was not exercised in any particular year. Thirdly, those reasons should include an assessment of the variation in property values that has taken place since the previous revaluation. That would allow us all to see whether the Government's decision not to go for a revaluation on any particular occasion was justified technically or was merely following a political imperative. I would be interested to hear the Minister's response to that.
	For the Liberal Democrats, the Bill is neither here nor there. We would never use the power that it grants—the power to revalue—because we would scrap the council tax system at the earliest possible opportunity. I support the Bill, but only because we would do away with the possibility of revaluation completely as part of a radical reform of local government taxation. The Bill forms one tiny part of what we will do if and when we come to power.

David Burrowes: We have heard many opinions today, but there is one incontrovertible fact: people like living in my constituency. They live there until and after they retire; they live in the same houses from generation to generation. In the meantime, the value of their houses naturally increases, often at a rate that far exceeds any income that might enable them to buy their houses.
	We often talk about value, and it is the subject of today's debate, but to many such people it is an abstract concept, becoming relevant only when they sell. We must be cautious about references to value and revaluation, which should be linked to ability to pay. Houses in my constituency are worth hundreds of thousands of pounds, but those values are not always linked to householders' ability to meet an increase in   council tax. Many an ordinary family in my constituency with a high-value property is scrimping and saving to pay the mortgage, and may have a lower standard of living than those with less valuable houses. Similarly, hard-working constituents in council or social housing may live in high-value properties that are already affected by a high council tax valuation, and would be more affected by a revaluation. Those who will not profit from a sale will not benefit from an appreciating asset.
	People on fixed incomes, such as those who lobbied me on behalf of the National Pensioners Convention, are particularly affected by council tax increases. As their life expectancy increases, there is the prospect of a fall in their standard of living over 30 years or more, primarily as a result of local taxation. That cannot be right, and the Bill cannot help them or alleviate their concern.
	The main problem is that, under the Bill, revaluation would be at the behest, or the whim, of the Secretary of   State. As the hon. Member for Cambridge (David   Howarth) pointed out, there is a danger that it would be politically motivated rather than being related to equity. The primary concerns would be how taxes could be raised, and how votes could be gained. The Bill suggests a move into the political arena rather than an interest in what is best for my constituents—a proper, equitable tax.

Kali Mountford: The hon. Gentleman seems to be arguing against council tax in principle, rather than merely opposing the revaluation. With what would he replace it if there were to be no revaluation at any time? Does he favour a completely different system, such as that recommended by the Liberal Democrats? What would he tell those involved in the Lyons review about how he would reconcile his concern about ability to pay with the need for councils to pay for services?

David Burrowes: I shall stick to the essence of the debate, which is not about my proposals but about the   Government's proposal to put revaluation into the hands of the Secretary of State. However, at the end of my speech I shall mention some of the principles that I   think should feature in the Lyons review.
	The Government have form in relation to politically motivated acts relating to council tax. As a criminal solicitor, I am worried about the possibility that previous convictions will be admissible as evidence in trials, but that is not precluded in this case. The Government certainly have form in connection with the   way in which they hand out grants under the distribution formula. In my constituency and elsewhere, we have seen the diversion of funds from London to the northern regions.

Tom Levitt: The hon. Gentleman may not know that I represent a Derbyshire seat. For 18 years, under a Conservative Government, we had the lowest grants in the country because the system was biased against us. I   put it to the hon. Gentleman that the Government have merely corrected the balance and introduced a fair system. It has indeed caused funds to move from the south to the north, but that is because the grants were not going there under the Conservatives.

Mr. Deputy Speaker: Order. The debate is not about the level of Government grant; it is about whether the revaluation in England should be postponed.

David Burrowes: I am grateful to you, Mr. Deputy Speaker. I am also grateful for the concession that funds have moved. The hon. Gentleman made my point for me: the Government have diverted funds, and have had political motives for the way in which they have dealt with tax.
	We fear that a revaluation process in the hands of the Secretary of State will prevent proper parliamentary scrutiny. We fear that the Bill would allow statutory revaluation. Council tax would become a property tax rather than, as was originally intended, a combined property tax and service charge. That leads me to my concern about the principles of any future system of local taxation. The 73-year-old who ended up in prison because she was not willing to pay £53 in council tax said, quite properly—perhaps this should be adopted by many of us as a slogan—"People pay taxes. Bricks and mortar don't pay taxes."
	The proposed revaluation process will take us towards a property tax. Our legislation should be based on accountability to people rather than property. We should support the amendment, which would prevent revaluation according to political whim.

Brooks Newmark: I shall try to be brief.
	The hon. Member for Southampton, Test (Dr. Whitehead) made some excellent points, which were relevant to our own stance. Our stance is that we do not want to proceed with the revaluation, but my hon. Friend the Member for Basingstoke (Mrs. Miller) produced a twist on that. Our election manifesto focused largely on pensioners and old people. Conservative Members feel that re-banding, particularly for pensioners, is an extremely blunt instrument.
	Many pensioners are asset-rich. They have sat in their houses for 20, 25 or 30 years and, often unbeknown to them, the asset value has increased. Unfortunately, however, those pensioners are also cash-poor. They are stuck in a difficult position. I fear that the re-banding will force many of them to move from the homes in which they have lived throughout their lives. We need to deal with that structural conundrum, which is why I   oppose any re-banding at any time.
	Let me deal with what was said by the hon. Member for Colne Valley (Kali Mountford) by quoting from a   press release sent on 20 December from the Office of the   Deputy Prime Minister. It announced that the Government intended to suspend the council tax revaluation and extend the scope of Sir Michael Lyons' inquiry, and stated
	"The additional work which Sir Michael will undertake will add value to the Government's own current work on a strategic view of the role and functions of local government, under its local vision programme."
	I am sure that many Opposition Members cannot but agree that council tax increases since 1997 of up to 94 per cent. in my constituency are more an example of double-vision than local vision.
	I go back to my original point. I was lucky enough to be approached by the IsItFair campaign. Last Wednesday, I had an opportunity to present to the House the campaign's petition. The concern of that campaign and the Braintree pensioners action group is not simply that the current system is unfair because of the way it affects pensioners in particular, but that they face a double whammy: re-banding would hurt many pensioners tremendously and ultimately force many of them to move home.

Tom Levitt: I am interested by what the hon. Gentleman says. He will be aware that pensioners can count the cost of their care in care homes against the value of their house and pay the cost at a subsequent date. Would he favour a similar system for council tax, whereby pensioners could run up a bill, as it were, and pay when their estate is realised?

Brooks Newmark: You make an interesting suggestion, but my main concern—

Tom Levitt: On a point of order, Mr. Deputy Speaker. The hon. Gentleman was referring to you. I think he meant me.

Mr. Deputy Speaker: I am grateful to the hon. Gentleman. I allow one slip, as has already occurred with another hon. Member, before I pile in, but I   understand from what he says that I am being very lax and I will remember that.

Brooks Newmark: I accept your reprimand, Mr. Deputy Speaker.
	The hon. Gentleman makes an excellent point on capital and how one may deal with the capital asset of one's house, but the primary desire of many of the pensioners to whom I have spoken is to avoid moving from their house and into a care home. I hope that the Government will reconsider the issue, because elderly people feel comfortable in familiar surroundings. Care homes are not necessarily, as we all understand, familiar surroundings. As I have said, re-banding pensioners' houses is a blunt instrument and will hurt many of the elderly in our country.

David Davies: I am delighted to have the opportunity to support the Conservative amendment. I see nothing confusing about it at all. It draws attention to the inequalities that are being created across the United Kingdom and calls for revaluation to be completely abandoned. I have no problem with either of those two concepts.
	I have seen at first hand how unequal things are becoming in my constituency of Monmouth. I heard the figure bandied around earlier of a 94 per cent. rise in one constituency. We would be very pleased if we had council tax rises of 94 per cent. over the past few years in my constituency. Someone else mentioned a rise of 74 per cent. There would be parties in the streets had our council tax rises been limited to 74 per cent. Prior to any re-banding in Monmouthshire, band D council taxes rose on average by well over 130 per cent. That is a truly shocking measure of the inequalities that are already being created before re-banding takes place. Obviously, therefore, I will speak against any form of re-banding.
	The Minister earlier repeated the oft-made claim that council taxes have absolutely nothing to do with central Government. In a rather long speech, the hon. Member for Southampton, Test (Dr. Whitehead) made one point with which I fully agreed: few people seem to understand how local government funding works, and that seems to apply to Ministers, who state that central Government policies have nothing to do with it.
	If a hypothetical local authority were run on a budget of £100 a year, around £80 would come from central Government in Westminster or, in Wales, from the Welsh Assembly; only £20 would be collected in council tax. Council tax simply tops up the money that local authorities receive from central Government.
	If minor adjustments were made to the amount coming from central Government—let us say that, in our hypothetical council, the £80 became £78, a drop of less than 2 per cent.—council taxes would have to go up by 10 per cent., from £20 to £22, to make up the difference. That is the so-called gearing effect, which has caused disproportionate council tax rises in the past few years.

Mark Hendrick: The hon. Gentleman will be aware that since 1997, central Government funding has increased in real terms by 33 per cent. Is not the level of council tax—I speak as a former local councillor who served two terms of office—to a great extent due to what local councils themselves want to set it at?

Mr. Deputy Speaker: Order. I hope that the hon. Member for Monmouth (David T.C. Davies) will steer skilfully back within the terms of the Bill. I would not want him to go off course as a result of that intervention.

David Davies: I am deeply grateful for your guidance, Mr. Deputy Speaker. I will try to answer the hon. Gentleman's point in a moment in a way that I feel is relevant to the Bill.
	I warn hon. Members that when re-banding was introduced in Wales, we were told that it would be fiscally neutral, just as hon. Members in this Chamber are being told that the re-banding exercise in England will be fiscally neutral. When Governments find that their estimates are not quite what they expected them to be, it is easy for them to manipulate local government funding to raise revenue directly for themselves. If hon. Members' experience is anything like the experience of those of us who live in Wales, they may find that their surgeries are full of people complaining about council tax rises of 130 per cent.
	If we abandon revaluation for good, how will we overcome the problems that will result? To take the   point made by the hon. Member for Preston (Mr.   Hendrick), I think that there is a strong case for looking at the inflation that is occurring within local authorities. Local authority inflation is not at the same headline level as the inflation figures generally. He talks about 33 per cent. extra going into local authorities. I do not dispute that, but what has been the percentage increase in costs for local authorities? For example, a Government initiative such as the teachers work load agreement in Wales—there is an equivalent one in England—is not properly funded. The National Union of Teachers talked about a shortfall of £30 million or so in that alone. If the costs rise above the level that is given to local authorities, they will have to make up the shortfall by putting up council taxes.
	Therefore, the first thing that we need to do is to set up an inquiry into how expensive it is to run a local authority, to take evidence from local government leaders and to ask them about the extra increases and burdens that they have and to what extent they are being funded by Government. There is a responsibility on Government not to announce any headline-grabbing initiatives unless they are prepared to fund them properly.
	The second thing that all of us need to do, whether in Wales or England, is to look at the way in which the formula for local government funding operates. That again is easy to manipulate. In fact, it has been manipulated in a manner that I believe is completely unfair to the southern counties of England and to the rural areas of Wales.
	When assessing deprivation, it is easy to look at the number of people on benefits, which is what the formula does. The formula should take into account average household incomes, because that is a much clearer way of defining deprivation than simply looking at the number of people of benefit. We all know of people working in agriculture, tourism or the service sector for the minimum wage. They are not taking home much money and their incomes are no better than they would be on benefit, but they are not counted as being deprived for the purposes of the formula.

Kali Mountford: The hon. Gentleman is making a cogent argument in favour of not going ahead with the revaluation now and to go ahead with the Lyons review. In looking at poverty indices, he should remember that there was a time when poverty was measured by the number of outside toilets in a constituency, which was not at all fair. Does he accept that looking at the number of people on benefit is at least a vast move forward from that point?

David Davies: That is a perfectly fair comment. I   agree that it is an improvement, but we have the ability to look at average household incomes rather than the number of people on benefits. Perhaps an hon. Member could correct me if I am wrong, but I believe that the number of white goods in a household is one of the measures being looked at. That, too, is a fairly random way of trying to define deprivation.
	It is not just in terms of deprivation where the formula is deeply flawed. Rurality is another important part of any formula. The more rural areas have higher costs; it costs more to do anything in rural areas. It costs more to collect the bins, and to send a lorry up and down the lanes of a rural area is more expensive than sending it past a few terraced houses. It costs more to maintain roads in rural areas, yet the formula in use at the moment reduces the emphasis given to rurality, which has had a deeply detrimental effect on those areas.
	My final point on the formula—there are many discrepancies about which we could talk—is that information relating to the age profile of the population has been removed. Clearly, an increasing part of any local authority budget is the part spent on providing nursing and residential care. It is vital that any formula that we have takes full account of the numbers of people aged between 65 and 70 and the incremental increases right the way up to people in their nineties. Otherwise, areas with large elderly populations are also going to lose out.
	I make two simple suggestions. The first is that we   abandon the revaluation and, instead, set up a committee or a tsar, as the Government are fond of doing, to look into the way in which the formula is applied to different areas. The second is to ensure that extra costs on local authorities are fully funded by central Government. If we did that, we would still have a tax that was not perfect. I am slightly off-message with my political party on this issue; it is unusual for me to say that. I am not in favour of scrapping council tax. I   do not think there was an issue with council tax until three or four years ago. Certainly, in 1999, when I   fought an election for the Welsh Assembly, council tax did not feature anywhere in anyone's election literature.
	It is not that I think the principle of council tax is unfair. It is the level at which it has been set. But I agree that, several years on, council tax has been manipulated to such an extent in England and Wales that I am not sure if we can continue with it. We may need to look at an alternative.
	We have an opportunity today to do something positive. We cannot come up with a new system overnight, but we can ensure that the system that we have is fairer. The alternative is to go ahead with re-banding at some point and to end up with more homelessness, more debt, more bankruptcies and more people going to prison.
	I urge Ministers and the Government to take responsibility for their policy and for council tax rises that are a direct result of their own policies. If they are not prepared to take responsibility, they will bear the responsibility at the next general election.

Stephen Crabb: This has been an interesting debate. Having heard Madam Deputy Speaker's clear and helpful guidance earlier, I intend to keep my remarks short and not stray too much into Welsh territory.
	I wish to respond directly to some of the comments of Labour Members, but first I should point out that the Welsh experience is relevant. The decision to postpone council tax revaluation in England was described by a   Minister as a huge, vaulting, 180° U-turn, and that full-on U-turn is embodied in the Bill. I accept that one of the motivations for that U-turn might be to have a much wider-ranging inquiry led by Sir Michael Lyons.
	I believe also that the Government are conscious of the political difficulties that could be caused and, with one eye on the experience in Wales, they will know of the resentment and anger that was caused by a botched council tax revaluation. The Government clearly want to avoid such political difficulties.
	The right hon. Member for Greenwich and Woolwich (Mr. Raynsford), unfortunately, is not in his place but I   enjoyed his speech. I learned a lot, although I did not agree with everything he said. He referred to the Welsh experience of revaluation and explained why he will not be voting alongside his colleagues this evening. He made a strong defence of the principle of revaluation and gave assurances that the English and Welsh contexts were different.
	The right hon. Gentleman tried to make the point that, in Wales, the purpose of revaluation was almost to raise money, but that flies very much in the face of explicit assurances given at the time by Labour Ministers in the Welsh Assembly—the right hon. Gentleman's colleagues—who promised that it would be revenue-neutral and was not aimed at increasing the overall yield.
	Likewise, the right hon. Gentleman referred to the number of winners and losers in the revaluation process and his figures were correct. The proportion of losers in Wales was 33 per cent. of households, with 8 per cent. being winners. Again, contrary to what he seemed to be suggesting, that is at odds with the assurances given by Labour Assembly Ministers at the time, who promised that there would be as many winners as losers. They talked about roughly 50 per cent. of households staying within the same band, with 25 per cent. of bills going up and 25 per cent. going down. I caution hon. Members who hear assurances that revaluation can be revenue neutral; the experience in Wales suggests that perhaps it will not be.

Tom Levitt: Why does the hon. Gentleman think that the number of people whose property valuation went up or down equates to whether the proposal was revenue neutral? Surely if 10 per cent. were big winners and 30 per cent. small losers it could still be revenue neutral. He has not given us the figures.

Stephen Crabb: Ministers in the Assembly have now conceded that the overall tax take has increased and rather than there being a 4 per cent increase in council tax take in 2005–06, the increase was actually nearer 10 per cent.

Roger Williams: The hon. Gentleman is making an interesting point and he is correct in terms of the numbers of winners and losers in Wales. However, there has been confusion between revaluation and re-banding, which is what happened in Wales. Re-banding did not take into account the bigger increases resulting from the revaluation and, as a result, there were rather more losers than winners.

Stephen Crabb: The hon. Gentleman makes a good point. The Royal Institution of Chartered Surveyors pointed out that had re-banding in Wales been undertaken in accordance with house price inflation, there would have been a much fairer outcome.
	The right hon. Member for Greenwich and Woolwich spoke about public acceptance of council tax and reiterated his faith in the high level of public acceptance of it. The acceptance of council tax in Wales has taken a serious knock as a result of the revaluation and Members on both sides should be aware that if such a revaluation went ahead in England, along anything like the lines of Wales, public confidence in council tax will be damaged.

David Jones: This has been an interesting and lengthy debate and I do not propose to detain Members longer than is necessary, but it is important to point out what has happened in Wales. Although I appreciate that, given the terms of this Bill, I am not entitled to stray too much into Welsh territory, I should nevertheless make it clear that the revaluation process in Wales indicates what might happen in England, should it take place there.
	It has been suggested by Labour Members that the difference between the revaluation envisaged for England and that which took place in Wales is that the former would be revenue-neutral. As my hon. Friend the Member for Preseli Pembrokeshire (Mr. Crabb) pointed out, however, assurances were given by Welsh Assembly Ministers that the Welsh revaluation would also be revenue-neutral. In fact, the Assembly's Finance Minister said:
	"I emphasise that revaluation is not a euphemism for increasing council tax."
	Well, the experience in Wales is that there was an increase in council tax, and as my hon. Friend pointed out, the tax take increased by more than 9 per cent. post-valuation.
	As the hon. Member for Brecon and Radnorshire (Mr. Williams) pointed out, the Welsh experience was   exacerbated by re-banding, but the outcome of the re-banding-revaluation exercise in Wales is that for many people on fixed incomes, particularly retired people, the annual council tax demand has become an   object of dread. In one ward in my constituency, for   example, some 40 per cent. of homes have been re-banded upwards. The proposal that we are discussing today is based on the Welsh experience. The Welsh have undoubtedly been used as guinea pigs, and the hard fact is that the Government have seen what has happened in Wales and do not like the consequences. They fear the political consequences in England.
	The hon. Member for Manchester, Blackley (Graham Stringer) pointed out that people have not been manning the barricades. They certainly have not been doing so in Colwyn bay—

Mark Hendrick: Before this year's general election, did not the leader of the hon. Gentleman's party say that if the Conservatives won that election, they would not examine the issue of revaluing properties for council tax purposes in their first term in office? So the leader of the Conservatives accepted that point, as well as our leadership.

David Jones: That is certainly the case so far as England is concerned, but of course, my party's amendment is founded inter alia on the reasoning that should this exercise proceed, inequality would be created between England and Wales. Real pain is being felt in Wales, and it is exacerbated by resentment at other parts of the country being let off the hook by the Government.
	We have heard much today about the Lyons inquiry. It is certainly extremely important, but in his evidence to the Welsh Assembly's Local Government and Public Services Committee earlier this year, Sir Michael said:
	"I will say a little about the Welsh experience. This will not give you any comfort, but it is of great benefit to me that you went further forward. We have learned important lessons from that",
	in the English context, of course. He said that
	"we are able, and, indeed, need—based on your experience in Wales—to do much more exhaustive modelling of the impacts before the bands are set. All of those things are absolutely fixed and understood, and are a result of having learned from your experience."
	Well, fine. I am sure that the people of Wales are delighted to have performed such sterling service to Sir   Michael and his interminable inquiry.

Mark Hendrick: Is the hon. Gentleman saying that what this Government have done with the council tax in Wales is similar to what the previous Conservative Government did with the poll tax in Scotland?

David Jones: What I would say is that the fact that the people of Colwyn bay are not manning the barricades is a tribute to the self-restraint for which, of course, my nation is known. But as I said, real pain is being felt in my country.

John Bercow: Does my hon. Friend agree that neither revaluation nor the proposed Lyons inquiry does anything to address the question of the simplification of local government finance? That is an important issue when one considers that local government finance is often thought broadly analogous to the Schleswig-Holstein question, to which, it was said, only three people ever knew the answer. One of them went mad, the second died and the third forgot what the answer was.

David Jones: Absolutely, and the longer that this debate continues, the more inclined I am to agree.
	The fact is that this Bill potentially creates great inequalities between the constituent parts of the United Kingdom. The Government could, if they wished, intervene, with the assistance of their colleagues in the Assembly, to ensure that revaluation in Wales is reversed. But that will not happen. Wales will continue to pay more. If this Bill is enacted, let the Government remember that for their own political advantage, they have saved the skin of English council tax payers and let Welsh ones twist in the wind.

Peter Soulsby: I had the privilege of leading Leicester city council for some 17 years. It has been said that that is longer than a life sentence, and at times it certainly felt like it. But in that capacity my city and I survived the rating system, the savage revenue and capital cuts of the early 1980s, and the rate capping and attendant confrontations that took place in what was a pretty painful period. We also survived the poll tax and the disastrous disruption and confrontation that it caused in our city, as it did elsewhere. We are now surviving the council tax and the attendant capping.
	It is with mixed feelings that I speak on this Bill, because I do not know that many of my constituents are likely to benefit from a revaluation, were one to take place. I realise that there are many different predictions about the possible outcome of such a revaluation, but it seems that my constituents and others in Leicester have suffered from the fact that house prices have risen less significantly there than elsewhere. So there is perhaps some benefit in revaluation, but set against that is the obvious pain that would be caused to those whose revaluation moved in a less favourable direction.
	Far outweighing any of those considerations is the enormous benefit that is to be gained from a thorough review of the functions and the funding method of local   government. I am enormously heartened by what   the Minister said in introducing this debate about   the Government's commitment to devolution and decentralisation in respect of local government. The Lyons review provides a unique opportunity to look at local government root and branch, and to consider not just its funding but ways of ensuring that its future is healthier than the preceding decades have been.
	On balance, I very much favour the deferment of any revaluation, and I look forward to a radical reform of the finance and functions of local government.

Mark Pritchard: The hon. Gentleman mentions his support for deferment. Does that support extend to supporting Government Front Benchers in their apparent desire to abolish local education authorities to reduce future council tax bills?

Peter Soulsby: As I understand the proposals in the White Paper, the Government envisage a new role for local education authorities. I do have some concerns about what that role might be. However, I look forward to a vigorous debate over the White Paper to ensure that local education authorities continue to play a vital role on behalf of local people who elect them to serve their local communities. I look forward to vigorous debate, but I do not envisage that the White Paper will end local government's vital involvement in local education.

Tom Levitt: Conservative Members have got the history wrong, as I recall that it was the Conservative party, from Nicholas Ridley onwards, that went into elections with a policy of abolishing local education authorities. We need to say categorically—

Mr. Deputy Speaker: Order. I have heard quite enough to realise that we are now moving into a debate on the future of local education authorities. However, that is most certainly a debate for the future, not for now.

Peter Soulsby: Thank you, Mr. Deputy Speaker. That was precisely the point that I was making.
	I welcome the Minister's commitment, in introducing the debate, to a continued role for a property tax in the funding of local government. I welcome it because a property tax is predictable, collectable and just—albeit sometimes a rough justice. I urge Ministers to pass the message back to the Lyons review about the vital need for a much wider range of sources of funding for local government. A property tax undoubtedly has its place, but we need a wider range of sources so that the funding that local government receives from central Government becomes a diminishing proportion of its total expenditure. It is certainly not healthy for local government to depend, as it increasingly has in recent years, on central Government funding. That is not healthy for local democracy, so we need a much higher proportion of local government funds to be raised locally if we are to increase the accountability of local government to local people.

Mark Hendrick: In achieving that aim, would it be sensible to review the role of the uniform business rate and its contribution to local government?

Mr. Deputy Speaker: Order. I hope that the hon. Gentleman will not go too far down that road in his reply. We are debating a Bill about the postponement of the revaluation of properties in England, and we should stick as closely to that subject as we possibly can.

Peter Soulsby: I shall certainly take your advice, Mr. Deputy Speaker, and stick to the matter in hand—except to acknowledge that I agree with my hon. Friend's point.
	If, as I hope will be the case, the Bill is successfully enacted, I hope that the Government will recognise that the postponement reinforces the need for them to look into the inequities of the present system of support for local government and will acknowledge that certain issues must be dealt with in the interim period before the Lyons review. I hope that they will reflect on how the   area cost adjustment works at present and how its funding should be restricted to authorities that experience higher-than-average wage pressures. I hope that they will look carefully into how resource equalisation works and the need for the current system to keep pace with reality. Full resource equalisation needs to take place every three years. I also hope that the Minister will look into the way in which daytime visitors are factored into the present arrangements, as the present estimates are long out of date, being based on a survey that took place some 15 years ago. We should bring the system truly up to date and make it truly more realistic.
	I heard Liberal Democrat Members argue earlier in the debate—as we expect them to do—in favour of local income tax. I know that there is a general view within local government that such a local income tax would be   uncollectable, expensive, confusing and, most particularly, a burden on employers. At least, however, Liberal Democrat Members are consistent in their views. I also heard Conservative Members argue powerfully for opposing revaluation. In doing so, however, they were asking the House to support an amendment that, if approved, would have the effect of providing just such a revaluation as they purported to oppose this evening.

Adam Afriyie: It seems to me that in the Local Government Act 2003, the Government were clear about their commitment to the principle of revaluation in England. If that revaluation were to be revenue neutral, what possible reason can the hon. Gentleman provide for the Government's U-turn on the issue, as they now want to postpone an early revaluation?

Peter Soulsby: I would give the same reason that Ministers have already given—that we have a unique opportunity to review the role and functions of local government, not just the method of financing it. I   greatly welcome that opportunity. As I said earlier, I have spent a large proportion of my adult life engaged in local government and over that time I have seen how local government has become thoroughly demoralised by the apparent diminution of its ability to influence what happens on the ground in our local communities and by the increase in central Government control over the same period. That is why I welcome the opportunity provided by the Lyons inquiry of having a thorough, root-and-branch review of what local government does and how it is financed and funded. I thoroughly welcome the fact that the Government have taken a turn in policy on that matter and now support a thorough review.
	I have suggested that I have some mixed feelings, but, on balance, I greatly favour the Bill that is before us today. I shall certainly vote in favour of postponing revaluation and I look forward to a renewal of local government and local democracy, which is promised as part of the review. I ask the Minister, however, to give an assurance that, in the intervening period, he and his colleagues will continue to try to find some solutions to the inequities in the current formula that underpins Government funding.

Tom Levitt: I, too, rise to support the Bill and I hope that it will not spend too long in Committee. As a two-clause Bill, I suspect that there is little chance of that; nevertheless, I believe that the Bill is sensible, timely and appropriate. I say that as one who, before coming to this place, has had experience as a parish councillor, a district councillor and a county councillor.
	The reasons for the delay in the revaluation are, as I   say, sensible. They are not about avoiding a meltdown in the council tax system, because I do not believe that that was imminent, but about providing an opportunity to review the entire local government structure. Speaking as one who trained in physiology for my   degree many years ago, I fully understand the relationship between structure and function. In fact, as far as local government is concerned, we cannot separate the two any more than we could in biological mechanisms in my earlier physiological study.
	It is also necessary to avoid too many changes. That might sound odd in view of the record over recent years, but if we were to have a revaluation followed by a change in the council tax system—either to another property-based system or to a local income tax system, perish the thought, or to some new as yet unthought-of imaginative system for relating the delivery of local services to the ability of local communities to afford them—that change would be big enough in itself for local authorities, the central Government and the House to cope with. To have a revaluation going on at the same time as we are preparing for that would not be the most sensible use of our time and would militate against the measures proposed in the Bill.
	My hon. Friend the Member for Leicester, South (Sir   Peter Soulsby) was in danger of underselling himself as a respected leader of his council. He certainly made some good appointments in his time, not least one of my relatives—although I hasten to add that that was long before I knew him. However, I agree with him that the decision to widen the remit of the Lyons review is at the heart of the reason for the delay in revaluation.
	I was not able to be here for the earlier part of the debate, but I have been fascinated by what I have heard. For example, I would like to know why the hon. Member for Cambridge (David Howarth), who is unfortunately not in his place, thinks that we should prejudge the outcome of a review of the whole function and structure of local government by saying that a local income tax is the only solution to all of local government's problems. I do not agree, and any solution has to be seen in the context of the new role for local government and the new functions that we anticipate it will take on.

Mark Pritchard: The hon. Gentleman mentioned pre-emption. I suggest that he should not pre-empt the Lyons inquiry by ruling out a local income tax.

Tom Levitt: Well, we must wait and see what the Lyons inquiry says. In the highly unlikely situation that it decides that a local income tax would be sensible, we would have to consider it properly. However, the problem with the local income tax is that the areas with the greatest need are also those where incomes are lowest. Therefore, a local income tax would raise the least money in those areas and be less able to meet the   needs of that community.

David Borrow: Does my hon. Friend agree that when reputable bodies have recommended that a local income tax would be viable—the Layfield commission in the 1970s is a classic example—it has always been alongside a property-based tax, not as a substitute for it?

Tom Levitt: The issue has been looked at many times over the years. Ever since the rating system was introduced, we have had a property-based tax and no one yet has put forward a serious proposition—I am clearly ruling out the Liberal Democrats—for local income tax to replace completely the property-based tax.

Celia Barlow: Does my hon. Friend agree that keeping a link between local providers and local income is an essential part of maintaining the link between stakeholders and local government?

Tom Levitt: I am coming to that point. It is true that we need such a link and I would not favour a situation in which 100 per cent. of local government services were funded by central Government. At the moment, the link is a little tenuous, because only £1 in every £5 that local authorities spend is raised locally. Although I shall not develop the point, I refer to the discussion that almost took place in the contribution by my hon. Friend the Member for Leicester, South about the future of business rates and their redemocratisation, which we should certainly consider.
	Several Conservative Members have said that they oppose all revaluation, but it was only in April—at the   height of a general election campaign—that the temporary, soon to be ex-Leader of the Opposition said that the delay in revaluation would be for "the first Parliament". That is what he told Sky television, and that implies a delay, not a cancellation.

Phil Woolas: My hon. Friend is making an intelligent and considered speech. Does he agree that the effect of the Opposition's amendment, were it to be carried, would not be to cancel revaluation, but to ensure that the Local Government Act 2003 took effect and that revaluation took place in 2007?

Tom Levitt: I do not like having to try to explain, let alone defend, Opposition policies, and I am sure that the cleverest minds in the ODPM have advised my hon. Friend that that is the case. I am happy to take his word for it.
	It is not so long since Conservative party policy was to have a revaluation every five years, which would have meant constant change. People would not only have waited for their council tax bill to fall through their letter box every spring, but for their quinquennial revaluation, and that would have been very disturbing for those who have to pay their council tax out of a fixed income—who were mentioned, almost tearfully, by Conservative Back Benchers. Those people are largely pensioners, who were reduced to poverty in record numbers by the last Conservative Government and who would have borne the brunt of the £2.5 billion cut in local authority services that the Conservatives proposed at the last general election. So I do not need the crocodile tears of Conservative Back Benchers to plead the case for people on fixed incomes.

Phil Woolas: I hope that my hon. Friend will accept my assurance that if pensioners are unable to pay their tax, they do not face imprisonment as punishment. It is only those who are unwilling to pay who face such a punitive measure, and there have been only two examples in the past 12 months.

Tom Levitt: I am grateful to my hon. Friend for that intervention. When he winds up, I may raise with him the issue that I raised with the hon. Member for Braintree (Mr. Newmark) about the holding of council tax debts against the asset value of a property.
	We have to look at the structure and function of local government together, which is why the Lyons review is important and must be given proper consideration. We need a big melting pot, with all sorts of ideas thrown in. Whatever comes out, we need to take time to consider the recommendations.
	Local authorities are changing their function, partly as a matter of evolution and partly because their relationship with central Government has changed. What I call silo services, such as housing, planning, social services and education—the vertical arrangement of services—belong to the local authorities of the past. I   am looking much more to local authorities taking a horizontal or co-ordinating role in those services, not only alongside providers from the local authority family but, through local strategic partnerships and local area agreements, bringing in other service providers.

Kali Mountford: rose—

Mr. Deputy Speaker: Order. Before the hon. Member for High Peak (Tom Levitt) gives way, I want to steer him much closer to the confines of the Bill. He is starting to essay a much wider point and he must know that he is out of order.

Tom Levitt: I am grateful to you, Mr. Deputy Speaker. Structure and funding are so intertwined that it is impossible to divorce funding from what councils are expected to do, but I shall obey your strictures. I give way to my hon. Friend the Member for Colne Valley (Kali Mountford).

Kali Mountford: I shall try to make sure that my question is in order, Mr. Deputy Speaker.
	Would not it be useful to consider what my hon. Friend the Member for High Peak (Mr. Levitt) said about structure and function, to ensure that the partnerships he mentioned become a wider reality across all services so that the silos to which he referred do not exist?

Tom Levitt: I feel an Adjournment debate coming on—for another occasion—on the subject of strategic partnerships and silos. I dare not take up my hon. Friend's sensible suggestion.

Mark Hendrick: Perhaps I can help my hon. Friend in bringing us back to discussion of revaluation. One of the Opposition parties wanted to cut the budget by £2.6 billion and would have increased council tax bills by 11 per cent., while the other would have increased payments through local income tax to about £260 per couple per year. Are not their crocodile tears simply to hide their proposals?

Tom Levitt: I could not have put it better myself. In my area, where the majority of properties are in band D or below, we would have been real losers under the Liberals' local income tax policies.
	I want to offer my hon. Friend the Minister for Local Government a few more ideas, as he takes forward the Bill and associated processes, including the Lyons review. We should look at the idea of funding police authorities separately from the local authority process, especially if we move to regional police authorities. There is something to be said for giving 100 per cent. national funding to such local authorities. They must be flexible in their deployment, however. Although police forces may move towards regionalisation at the higher level, they are also moving towards neighbourhood policing at the local level. I expect to see such trends throughout local government services.

Andrew Gwynne: I am pleased that my hon. Friend made that important point. Does he acknowledge that the precept system for raising finance for police and fire authorities and other countywide structures is often confusing for many council tax payers? That needs to be addressed by the Lyons review as part of the overall picture—

Mr. Deputy Speaker: Order. We are not debating the Lyons review. We are debating the Bill, so I hope that the hon. Member for High Peak will not go back to that territory.

Tom Levitt: I shall follow your advice, Mr. Deputy Speaker, and cross out much of what I have left to say.
	I want to take up the point that my hon. Friend   the   Member for Leicester, South made about   property-based taxation. It is predictable and collectable, and there is a rough justice about it. As my hon. Friend the Member for South Ribble (Mr. Borrow) said, we shall probably continue to have a property-based taxation system, simply because it is easier to understand in relation to local services. As my hon. Friend the Member for Hove (Ms Barlow) said, the system must be transparent. There must be some sort of local collection for local services. Accountability and effective delivery of services must be related to that local funding. Although council tax accounts only for one pound in every five of local government spending, it gives local authorities flexibility on the margins, to focus their services on local needs.
	My hon. Friend the Member for Leicester, South also   referred to day-time visitors. As the Member representing much of the Peak national park, where there are 22 million visitors a year, I saw cash registers ringing as he spoke.
	From my history books, I remember that in America people talked about no taxation without representation. In the context of this debate, we are saying that we must have a local funding system, but that there must be confidence in it. That is why we cannot separate structure and function. That is why the delay is absolutely right, to give us time to consider the Lyons review; and that is why, after due consideration, we will come up with a funding system that is effective, accountable, local and just.

Kali Mountford: When I first heard the proposal to delay the revaluation of council tax, I admit I felt some dismay. If we are to carry on with council tax, revaluation is a necessary part of that system, given that house prices are rising erratically, with prices in areas differing from one another, not just regionally, but in my constituency, where a house that sold for £60,000 two years ago was sold for £148,000 last week. There has been a similar increase in the value of similar houses in that village, so what fear is there from revaluation overall? Very simply, the fear is that if we do not take time to take stock of how we raise local funds and make local democracy count, we will face some difficulties. I could not support the Bill if it did not run alongside proposals to consider the way that we fund councils overall.
	I have a small degree of experience: when I was a chair of finance, I had to consider exactly those issues in the context of the moneys that we raised for the local area. At that time, about 50 per cent. of revenues were raised directly from the local population, and the other 50 per cent. came from the revenue that we got directly from the Government. Of course, such revenues are not the total amount that a council spends. We must also consider the grant, direct funding and capital systems, all of which must be applied for. Under the previous Government, such applications were made in terms of a huge, competitive arena, with one council set against another. I am not convinced therefore by Conservative Members' arguments that the council tax system, which they set up, has now become so inherently flawed that revaluation should never be necessary. That is a ludicrous, ridiculous argument. If we carry on with council tax, revaluation is an essential part of the system; otherwise the existing inequities will not only persist, but broaden.

Celia Barlow: Would my hon. Friend consider something that the Opposition have perhaps suggested: regional revaluation? Can she find a place for that in the future?

Kali Mountford: My hon. Friend suggests an interesting and innovative idea that has not yet been tried by our country. Other countries have regional systems. I can imagine hearing Conservative Members immediately crying foul over Europe, where that system is popular. They would immediately start to say that such a system was a precursor to the federalisation of the European Union—

Madam Deputy Speaker: Order. I sincerely hope that the hon. Lady is not going down the route of Europe and federalisation. Back to the Bill, please.

Kali Mountford: I am grateful to you for your guidance, Madam Deputy Speaker, but this just shows that no legislation stands in isolation from any other issue or from comparisons with what happens elsewhere. I suggest that there is a lot for us to learn from what happens in other places and that there are some innovative ideas to consider. If we are to go along with   the Government on the proposal to delay the revaluation, dare I venture to suggest, Madam Deputy Speaker, that it only makes sense to consider the suggestions made by my hon. Friends and other hon. Members?
	A consensus across the House suggests that some people have not been well served by the council tax. A lot has been made of people on pensions, but they are not the only people on fixed incomes or the only ones who have faced difficulties. Of course, if we consider the number of people who do not pay council tax because of their fixed incomes, that takes away a tranche of the argument about revaluation, because revaluation is nonsense if no council tax is paid, so why worry about it? I venture to suggest, however, that some people are about to fall off the edge of benefits.
	It makes sense to ensure that we look at a system that has longevity. The council tax system, which was introduced by Conservative Members who suddenly seem to hate it, has had some longevity, but not enough. If we are to have stability in the system, we must take account of such things as how people deal with their benefits, how they build family income and how they deal with family expenditure.
	The idea proposed by Liberal Democrat Members does not provide all the answers. We have not heard how they would deal with people on fixed incomes if we were to adopt a local income tax system. We do not know how they would deal with the complexities of raising money throughout the country, maintain a democratic element in the system, or ensure that that system would address all the inequities about which we have heard.
	I would not throw out the idea entirely, however. The Lyons review should examine such a system. I do not want to go on and on about the Lyons review because we have already been told that the subject of the debate is quite narrow, but given that we are buying ourselves some time—that is the only way in which I can cope with the Bill—it would be sensible at least to consider the proposal. The system has inherent problems, and I think that the hon. Member for Somerton and Frome (Mr.   Heath) acknowledges that, because he seems to be nodding at me. It would not deal with such matters as local accountability and people on fixed or low incomes. How would we ensure that such people would not have to pay more than they already do?

Andrew Gwynne: Does my hon. Friend agree that one of the inequities of the current council tax system is the fact that two identical houses can be in different bands if one was valued in 1991 and the other was subsequently sold on and thus re-banded? Does that not make a mockery of the Opposition's stance of ruling out any kind of re-banding or revaluation for ever?

Kali Mountford: It certainly does, but my hon. Friend must be careful because he might steer me into something of a rebellious mood if he reminds me of the terrible inequities that exist because we have not had the   courage to go ahead with a revaluation, which I   seriously believe to be necessary. Such inequities exist in my constituency and I am worried about them. What   does my hon. Friend the Minister for Local Government think might come out of this period of reflection when people such as me realise that there are inequities in our constituencies and want to ensure that we will either go ahead with a revaluation at some point, or replace the system with something that works better?

David Borrow: Does my hon. Friend share my worry that a long delay before a council tax revaluation will exaggerate the inequalities that already exist? Does she agree that given the link with Government grant, the longer we put off revaluation, the longer the amount of grant that goes to each local authority will not reflect the economic success or failure of each locality?

Kali Mountford: My hon. Friend makes his point well and I share his concern. That is why I have difficulties with the Bill. I can go along with the Bill at all only because we are considering it in the context of what we can do in the long term. I hope that my hon. Friend the Minister will indicate that if we do not move away from   the current council tax system, there will be a revaluation at some point, because otherwise the relationship among local people, their local authorities and the Government will become fractured to such an extent that it will no longer make sense.
	A huge amount of council tax capping has taken place under both Conservative and Labour Governments. There is a strong argument that that should not happen and that if a local authority chooses to tax people into oblivion, the local electorate should be able to deal with that at the ballot box. However, I see such authorities being protected. I had to cope with the then Thatcher Government, and one year I had to deal with £43 million of cuts out of the council tax—

Madam Deputy Speaker: Order. May I remind the hon. Lady that we are discussing a Bill about revaluation?

Kali Mountford: I take your strictures, Madam Deputy Speaker. That unpleasant trip down memory lane did not do me much good in any event.

Tom Levitt: My hon. Friend talked in the early part of her speech with typical compassion for those on fixed incomes and on benefits. Does she agree that, whether or not revaluation takes place, it is important under whatever system of local taxation that we push ever harder to increase the take-up of council tax benefit for those who are entitled to it? Perhaps there should be a regulation to stipulate that that should be given more prominence on council tax demands.

Kali Mountford: My hon. Friend is right. Take-up does not just need to be given prominence on council tax demands; there are many places where we could encourage take-up not just of council tax benefit but of other benefits. He makes a good point, because this Bill has no relevance to those who should not be paying council tax. I agree with him that that is right, but even if we take that out of the equation we still have a responsibility to all those on fixed low incomes who are none the less just outside the remit of benefits and have huge problems. I venture to suggest that people have huge problems under today's system.
	Everyone would think from Conservative Members' speeches that revaluation means only an increase in council tax for everybody concerned. That is not at all   the case. As one area goes up in value, another goes   down. People on fixed incomes who are just outside council tax benefit rates are suffering disproportionately, and my concern is for those people. We are talking about those who are not wealthy, who live in a property that, as against other properties, has not risen in value at the same rate. Therefore, in terms of property as a proportion of income, those people are much worse off. That seems a good reason for carrying on with revaluation. If we continue with council tax as it is now, we must look carefully at such matters. We cannot escape our responsibility to those people.
	I shall go along with the Minister for today's purposes.

Julie Morgan: Does my hon. Friend agree that there might be a case for support for council tax payment as an automatic tax credit, rather than as a welfare benefit?

Kali Mountford: That is an interesting proposal—

Madam Deputy Speaker: Order. I would not want the hon. Lady to be tempted down that route, interesting though it may be.

Kali Mountford: May I just acknowledge the inventiveness and compassion of my hon. Friend's proposal? I hope that Ministers will listen to it. If they do so, I for one shall be listening very carefully alongside them.
	My hon. Friend points out the difficulties that we face with the council tax system, especially if we do not go ahead with revaluation. As she pointed out when she referred to credit, the present system has pitfalls, whereas a credit-based system is a gentler slope that allows people more flexibility in their arrangements and more fairness. That is what concerns me about not going ahead with revaluation. For some, not going ahead with revaluation may be a boon. They may think, "Hip, hip hooray! I will not have to spend more." There are others, however, who may not yet have realised that they would have been spending less. The only way that   the council tax can work is if some fairness is built into the system.
	We may think that the only way in which a system can work is if the value of property reflects at least in part the amount of money available to a family, but that is not true, as we all know. I see Liberal Democrats sniggering; they think that the answer is to go for some local income tax, but I do not think that that is perfect either.

David Borrow: rose—

Tom Levitt: rose—

Kali Mountford: I give way to my hon. Friend the Member for South Ribble (Mr. Borrow).

David Borrow: Does my hon. Friend agree that there is no truly perfect form of tax? The art of local government is to have a good basket of taxes that overall leads to as much fairness as possible. A property tax should be part of that basket of taxes.

Kali Mountford: I agree, but I would be careful that the basket was not so full of promise that it became overly complex.

Tom Levitt: Just before the previous intervention, I   could sense that Madam Deputy Speaker may have wanted to bring my hon. Friend back to the straight and narrow. As the debate has raised so many interesting side issues, which are in fact at the heart of the debate, will my hon. Friend join me in asking Mr. Speaker whether we can have a debate of an hour and a half in Westminster Hall to discuss these matters?

Madam Deputy Speaker: Order. The two hon. Members may wish to discuss that outside the Chamber. Right now, I want hon. Members to discuss the Bill.

Kali Mountford: Were we to do as my hon. Friend suggests, I am sure half the House would be in Westminster Hall with us and the place would be full. The funding of local democracy is so complex that it is important to all of us, especially those of us who care about the neediest in our communities. If the debate serves any purpose, it is to remind us who we are here to serve. Through the relationship that we should have with our colleagues in local government, we should make sure that the services available are paid for properly, and that people who cannot afford to pay are not forced to pay more than they need to. They will be forced to pay more than necessary if we do not examine closely the proposed revaluation of properties.
	I mentioned earlier that one house in the village where I live has escalated in value from £60,000 to £148,000 in just two years.

Charles Walker: Does the hon. Lady accept that all the other houses in that road would have gone up in value too, give or take a few thousand pounds? That is not unique to her constituency. She has said it before, as well.

Kali Mountford: I am dreadfully sorry. I was not aware that I was in "Just a Minute". I was about to address the point that the hon. Gentleman makes. The value of the village has risen, as the value of the house has risen. In a village 2 miles further on, which does not have the same attractive postcode, does not have film crews up and down its lanes every day and does not attract the same tourism, property prices have levelled off and started to descend. Although the houses are of the same type, there is a huge difference in property values between the two villages, and between the amount that those families should pay and can afford to pay. It does not reflect their family income and how they deal with it. That is why, if I am to support the Government tonight, it is on the basis that we consider how the system in future will protect those constituents and make sure that the poorest pay fairly and appropriately, but no more than they have to pay. If the Lyons review does not come up with something—

Lindsay Hoyle: My hon. Friend makes a valid point. She mentioned alternatives. One alternative is an income tax to replace council tax, as other parties may suggest. Does she agree that that would place a burden on the poorest council tax payers, and that it is the wealthiest who would benefit? That is a danger, and it is why we must get this right tonight.

Kali Mountford: That is precisely the problem. Opposition Members have not missed that point. There is a flaw in the suggestion, but let us all try to achieve consensus across the House. It is clear from the debate that Members from all the main parties recognise the   difficulties. We need to reach a consensus on the solution. If we cannot do that, it makes sense to use council tax as it should be and to go ahead with revaluation.

Lindsay Hoyle: My hon. Friend has been very generous with her time. Buildings do not move, and people will always pay a tax on their property. In the past, people refused to accept a personal tax and preferred to return to a tax on property. The danger is that people who do not work in this country and who get paid abroad, for example, airline pilots and people who work on ships—

Madam Deputy Speaker: Order. We are now going very wide of the Bill before the House.

Kali Mountford: My hon. Friend has said that we need a system that provides stability, which is a point that I   made earlier, and property taxes provide an element of stability. If stability derives from the facts that property is fixed and does not move and that those people who own property owe a responsibility to the community where their property is located, we must make sure that the system properly recognises property values. As long as the system reflects property values and locations and provides stability, we cannot escape the need for revaluation.
	The Government must return to revaluation at some point, because they cannot escape it for ever. As long as it is politically expedient for Conservative Members to say that delaying revaluation will save people from a huge hike in council tax in the short term, the political danger exists of not protecting those people who would do rather better out of revaluation than has been suggested in tonight's debate.

Peter Soulsby: Does my hon. Friend agree that the problem with council tax is the imbalance between the   funding that it provides at a local level and central Government funding? She has provided an example of a   council that receives more than 80 per cent. of its funding from central Government and less than 20 per cent. of its funding from council tax. Does she accept that, where that imbalance exists, comparatively small   changes in central Government funding have disproportionately large effects on local council tax? Does she accept that that situation is unhealthy—

Madam Deputy Speaker: Order. That is a very lengthy intervention, and I am not sure whether it is appropriate.

Kali Mountford: I shall try to use some ingenuity, Madam Deputy Speaker, to ensure that it is appropriate.
	Earlier, an Opposition Member discussed his dissatisfaction with the gearing effect in the current system. The proportion of funding that is raised locally is the essence of local democracy, and when I was a chair of finance, it was about 50:50. I recently met a former Cabinet member from those days—I will not mention his name to save his blushes—who said that he wished that he had not moved in the same direction as the Tory party, because he now sees the problems caused by breaking the link between the effects of local decisions and the amount of money raised locally. As long as local democracy is supported by a cushion, decisions will be made centrally rather than locally, which is a danger.
	My hon. Friend the Member for Chorley (Mr. Hoyle) has discussed property taxes and stability. As long as we continue to relate council tax to property, an element of stability will be required in order to uphold the very democracy that we are discussing. As I have said—I   have said this so many times that I am sure that my hon. Friend the Member for Chorley must have heard me—an element of revaluation is required, otherwise the system will continue to be nonsense.

Celia Barlow: Does my hon. Friend agree that one of most important aspects of revaluation, should it come,   will be transparency? Transparency between stakeholders and local councils is one of the most important aspects of local government democracy.

Kali Mountford: My hon. Friend is right. The stakeholders are council tax payers, who need to know why they are paying the amount that they are and what it is going towards. They should be able to find that out from the local authority's annual report. However, what is often invisible in the council tax process is the amount of money that comes in from central Government, not only to the local authority but directly to services. That has been happening a lot more in recent years. For example, money is going directly to schools—

Madam Deputy Speaker: Order. Hon. Members are once again trespassing wide of the mark. We are narrowly considering revaluation.

Kali Mountford: I apologise, Madam Deputy Speaker. The point that I was inadequately trying to make is that there are many ways in which we can raise a council tax. The element that is dependent on property, and therefore on its revaluation, makes up only a small part of that. The transparency of the transaction must be absolutely clear, but in the context of transparency about all such matters.

Lindsay Hoyle: Revaluation happens across the board, especially where there is a shire district, a district, a parish and then police rates on top, and it is important that council tax payers understand it. Does my hon. Friend agree that they should be given better information?

Kali Mountford: Absolutely. If and when we reach the point where revaluation is necessary, people should be given full information about the effects of not having it—not only on the family concerned but on the amount of money available for all those services. The gearing effect, which Conservative Members acknowledged, is particularly pronounced when it comes to the police and fire services, where a precept is built upon it. It can be made to sound as though not revaluing will have a disproportionate effect on the amount that is raised locally for those services. People will say, "I'm not prepared to pay a 74 per cent. increase", not realising that the burden on an individual family is not 74 per cent. of the total council tax payable but 74 per cent. of a certain part of it. The effect on the family's budget is small compared with what some Members have suggested.
	If that stability is to persist, and if it is to be based on property, we have to be honest about what that means to people. We cannot go on basing it on the current valuations ad infinitum, otherwise in the long term we might as well pluck a figure out of the air and say, "This is the amount we will all pay", with no more reasoning behind it than that.
	We will do ourselves and the country a disservice if we do not engage with the Lyons review properly, are not transparent about what we do, and do not use this opportunity to look at the relationships between local   government and national Government, and the population whom we are here to serve and all the   services that we decide to provide. We need to look again at the moneys that we raise from property and accept that under that system revaluation will continue to be necessary.

Rob Marris: Revaluation is a classic example of something that lasts longer than one expects. That often applies, although not necessarily to a pint of beer. We should consider the history of revaluation because it has always been a problem in this country.
	The official Opposition's reasoned amendment decries the fact that Second Reading would merely delay rather than cancel council tax revaluation. We have a mixed and often unfortunate history of revaluation being delayed for too long. I am pleased that the Bill provides for a delay—I shall explain the reason shortly—but I urge my hon. Friend the Minister for Local Government and the Department not to delay for   too long.
	The Rating and Valuation Act 1925 provided for five-yearly revaluations of properties for rating purposes in England and Wales, but they kept getting postponed. A revaluation was managed nine years later in 1934 and one was due to start in 1938 but was postponed for two years. Of course, in 1939, the war began and one could not conduct a revaluation during a war, especially as so many properties no longer existed. However, we were back on track with the Local Government Act 1948 and revaluation was supposed to take place in April 1952. As the Library points out, that was rather ambitious and it was postponed until 1953 by   ministerial order. The provisions in the Bill for ministerial order to delay revaluations should not therefore surprise hon. Members. It has been done in the past.
	The 1956 revaluation was partial because residential property was assessed—believe it or not—on its value in 1939, before the second world war.

Phil Woolas: I commend my hon. Friend for his research. He referred in passing to the decision in 1955. We know from the revelation in Harold Macmillan's diaries that, at the first Cabinet meeting under Eden's   premiership, it was decided to set the election date before the forthcoming revaluation. Perhaps that explains why revaluation goes to the heart of the Conservative's party difficulties, given that history repeated itself in the late 1980s.

Rob Marris: I am shocked that any Government would play around with revaluation for party political purposes. However, that is the sort of history that the Conservative party has. I referred to 1956, not 1955, but I believe that the Government managed to string matters out until April 1963. Revaluations can get delayed for too long. I understand why, for the reasons that my hon. Friend the Member for Colne Valley (Kali   Mountford) outlined so eloquently, there should be some deferral, but I urge my hon. Friend the Minister for Local Government to heed history and not delay revaluation for too long.

Alan Whitehead: Does my hon. Friend accept that, on the occasions that he mentioned, the trajectory of the index of house price increases was substantially lower than in recent years? The possibility of putting off a revaluation for some time did not therefore have the distorting effect of more recent years. Does he believe that that was a factor in previous revaluation deferments?

Rob Marris: I agree. My hon. Friend anticipates one of the points that was at the top of my list. We are in the current position partly because of the way in which house prices have increased and our prosperous economy under the Government. I shall not give all the economic statistics—I am sure that you would not allow that, Madam Deputy Speaker—but when we discuss banding and revaluation, we need to bear it in mind that one of the reasons for public disquiet about that and the beginning of a public debate—I hope that the deferral for which the measure provides will encourage that debate—is prosperity and rising house prices.

David Borrow: Does my hon. Friend agree that some lessons can be learned from the success of the revaluations of business rates? Since 1990, they have stuck to a five-yearly sequence. The Government should aim for the same success with council tax and the regularity of its revaluation.

Rob Marris: I certainly agree that we can learn from what has happened with business rates, and the House needs to discuss business rates as part of this overall package. We could also learn from what happened in Scotland. The Opposition's amendment tonight decries the fact that the revaluation applies only to England. In Scotland, revaluations have taken place fairly frequently: in 1961, 1966, 1971, 1978 and 1985. They did not take place after 1985, because the poll tax was then introduced, initially in Scotland, without great success either there or in England and Wales. So, yes, we should defer the revaluation in England, but we should certainly not cancel it.
	I disagree with the Opposition's amendment. They dislike the Bill because it applies only to England, but I   think that it is absolutely right that we should defer   the revaluation in England. Scotland and Wales have their own Parliament and National Assembly respectively, and they should be able to do this at a different pace. In Wales, part of the problem was that the revaluation was carried out following a 129 per cent. increase in house prices since the previous one, which brings us back to the point made by my hon. Friend the Member for Southampton, Test (Dr. Whitehead) about house prices putting pressure on us, in terms of the public debate on this issue.
	This debate is being held at the same time as Sir   Michael Lyons' review. Being a west midlander like me, you, Madam Deputy Speaker, might almost remember Mike Lyons when he was in short trousers. His first major job, as I am sure all right hon. and hon. Members know, was chief executive of Wolverhampton metropolitan borough council, as it was then called. Of   course, it is now Wolverhampton city council. Sir   Michael Lyons—as I must now learn to call him—is a man with a great track record. I can quite understand why a deferral of the revaluation would be important while the Government are having that investigation carried out, and why such a deferral—as set out in the Bill, and as decried by the Opposition—would be a good thing. I am sure that Sir Michael's review will be very thorough, and very illuminating for us.
	We need a public debate on this issue. My hon. Friend the Member for Colne Valley spoke eloquently about the need for public information. There are an awful lot of people, including some in this Chamber, who do not understand the concept of a measure being revenue neutral. A re-banding exercise can be a problem, but if it is set against a series of revenue neutral measures—which is what I hope would happen in England, although it did not happen in Wales—it can even out the discrepancies that have built up due to differential house price rises. Prices in some areas will go up more than others. For example, prices in Stourbridge might go up more than those in Wolverhampton, causing things to   get out of kilter. A revenue neutral revaluation would therefore be absolutely right. However, it takes a while to explain the concept of revenue neutrality to people, many of whom, because of many years of underinvestment in education by the Conservatives, are fairly innumerate. We need to have that kind of public debate.

Lindsay Hoyle: My hon. Friend has rightly identified the issue, which is the fear factor among the public. One of the biggest worries that people have is about their council tax. After what has happened under previous Governments, there is a real fear that a revaluation would simply mean an increase, but it could be revenue neutral. Does my hon. Friend agree?

Rob Marris: I certainly do. Such fear is often a fear of the unknown. It is sometimes whipped up by the Opposition parties, and sometimes by the situation being mis-explained by the media, although sometimes it is properly explained by the media. With that fear comes a fear of revaluation per se. The Bill would defer, but not, I hope, cancel the revaluation. I think that it would eventually happen by means of a statutory instrument; my hon. Friend the Minister will correct me if I have misread the process outlined in this very lengthy Bill. I think that an order would be brought before the House and dealt with under the affirmative resolution procedure. The issues would, therefore, come back before the House, and I hope that they will do so, fairly speedily after the conclusion of the Lyons review. As I   have said, I want a deferral, not a cancellation.
	According to their reasoned amendment, the Conservatives want a cancellation, almost for ever. That seems very strange. I was talking about the history of these revaluations, and I am open to being corrected at any point, but I do not think that there has been a revaluation in Ireland since about 1834.

David Borrow: My hon. Friend has mentioned the Conservative party's amendment and the fact that it calls for a cancellation. Is he aware that if we decided to vote for the Conservative amendment, we would ensure a 2007 revaluation of council tax?

Rob Marris: I am aware of that, because of the   intervention made earlier by my hon. Friend the Minister. I do not know whether that was clear to the   Opposition when they introduced the amendment, or whether they got it round the neck—to use the vernacular—as they often do, but no doubt we will be told in the wind-ups.

Alan Whitehead: My hon. Friend was making an interesting point about the possibility of revenue neutrality of revaluation in principle. Does he accept that the introduction of the council tax in 1992, with the bands and proportion of total revenue that it raised, instituted the gearing effect about which we have heard this evening? Is he aware of methods by which the gearing effect could be neutralised, in terms of the order in which council tax is determined as a result of the council's budget-setting process. Will he urge the Lyons inquiry to consider that, along with the question of revaluation?

Madam Deputy Speaker: Order. That is very lengthy for an intervention.

Rob Marris: And if I were to stray too far into what the Lyons inquiry ought to do, Madam Deputy Speaker, you would say that I was going too wide of the point. As ever, my hon. Friend makes a valid point, as he did in his lengthy and interesting contribution to the debate earlier. He is much more numerically adept than I am. We might have to encounter gearing as a problem.
	Under the Bill, revaluation would be deferred but not done away with. While I want a deferral, I do not want it to be deferred into the mists of time. A revaluation will address the question of differential house price rises. When house prices rise in different adjacent parts of a constituency, city or rural area, those who have seen an above-average increase in the value of their houses pay lower council tax than they would if a revaluation had taken place. Correspondingly, those whose houses have risen in value by less than the average, assuming a revenue-neutral system, would pay more council tax than they should. That happens to some extent in the current system, but the longer a deferral continues, the   more pronounced that unfair trend becomes. Of course, it favours those who have done best out of rising house prices in the booming economy under this Labour   Government. The discrepancies and unfairness therefore get worse the longer a revaluation is deferred. Consequently, as I said to my hon. Friend the Minister, while I support a deferral of the revaluation pending the outcome of the Lyons inquiry, I do not want it deferred too long.
	I think that council tax is a good tax. There are problems with it, and I am glad that the review is going on. My hon. Friend the Member for South Ribble (Mr.   Borrow), in an intervention on my hon. Friend the Member for Colne Valley, said that there is no perfect tax. Arguably, death duties are a perfect tax, because one pays them only when one is dead. Council tax is quite useful because it is on a house that one cannot move—I do not know the collection rate in your area, Madam Deputy Speaker, but in mine it is about 97 per cent., so it is important to bear that in mind in terms of revaluation. We need to consider what revenues might be brought in, but we also need a sound system that by and large works well, even though there are difficulties.
	I want to stress again the need for better information to accompany the deferred valuation, as mentioned by my hon. Friends the Members for Colne Valley and for South Ribble, so that people can understand the system as fully as possible and that we can have a properly informed debate.
	The Liberal Democrats went into the last general election saying that they would replace council tax with a local income tax. That is an entirely honourable and understandable position, although they may now have resiled from it, but we need to debate it properly if we are to consider revaluation in the context of an alternative to council tax.
	The amendment says that
	"removal of the need for revaluation of domestic properties offers taxpayers no protection against the imposition of new higher council tax bands."
	That shows that the Opposition have a different view of what a revenue-neutral revaluation might constitute. It   suggests that the six Members who tabled the amendment do not understand the system that we have, let alone what it might be turned into. No doubt the Opposition Member who winds up the debate will explain that I have misunderstood, and that those who tabled the amendment understand the mathematics and simply take a different political view, but the wording suggests otherwise, which is deeply worrying.
	I am sure that the Liberal Democrats understand how the system works and take a different view—if they have a view at the moment. I would not talk about that now even if I were allowed to. It seems, however, that   Her Majesty's loyal Opposition do not understand the system that we have, but have nevertheless tabled an amendment suggesting that we decline to give a Second Reading to a Bill deferring revaluation because of all the nasty things that they think would happen in the event of such a revaluation. Let us leave aside the point made by my hon. Friend the Member for South Ribble, who echoed my hon. Friend the Minister in saying that the Opposition did not appear to realise that if the Bill were not give a Second Reading, revaluation would go ahead. The Opposition seem to be telling us that the Government have got it all wrong, but it is they who have got it all wrong, because they do not understand the present system.

Robert Syms: We have had a good debate, featuring many ex-Ministers and many future Ministers, as well as Members with great experience of local government. It has been such a good debate that many people rushed in at the end to make their own speeches. They must have been terribly impressed by the earlier contributions of Members on both sides of the   House.
	I want to concentrate on what has been said by Back Benchers. The right hon. Member for Greenwich and Woolwich (Mr. Raynsford) made an interesting and   honest speech, stating candidly that he thought the revaluation should go ahead. The speech will bear some rereading, as it contained some interesting comments aimed at Ministers. The hon. Member for South Ribble (Mr. Borrow) demonstrated his experience with the Valuation Office Agency and made some interesting points, particularly about the cycle of revaluation between council tax and the unified business rate. I think that many people took his speech on board.
	My right hon. Friend the Member for Skipton and Ripon (Mr. Curry) made a typically thoughtful and   independent-minded speech. Much of it was not party policy, so I will not go into the details, but he made a good point about the balance of funding between council tax and the unified business rate. No doubt the Lyons review will have to take account of that.
	The hon. Member for Manchester, Blackley (Graham   Stringer) showed his experience of local government, as a former leader of Manchester city council. He said that the council tax had been born out of the difficulties of the poll tax in earlier years. I have some sympathy with his view. It is rather like blaming Napoleon for the introduction of income tax: taxes are normally introduced as a result of   crises rather than serene weather and careful thought.
	My hon. Friend the Member for Mole Valley (Sir   Paul Beresford), a former Minister and someone who knows a great deal about these matters, spoke of his concerns and of how he thought council tax ought to be varied. His speech, too, was not party policy, so I shall pass on to the hon. Member for Hove (Ms Barlow), who   made a characteristically good speech and dealt extremely well with a Liberal Democrat intervention about local income tax.
	My hon. Friend the Member for Basingstoke (Mrs.   Miller) was an eloquent defender of her constituents. She spoke of the increase in council tax in her area, and of all the pressures that must be borne by a growth area with additional housing such as Basingstoke and other parts of Hampshire.
	The hon. Member for Southampton, Test (Dr.   Whitehead) again showed his experience of local government. He took us from Merton to Wakefield—it was a long, long, long journey, but eventually we got there. The hon. Member for Cambridge (David Howarth) again showed his local government experience and provided a history lesson about the 1992 Act that introduced council tax.
	My hon. Friend the Member for Enfield, Southgate (Mr. Burrowes) made the valuable point that, if the value of one's house is high, that does not necessarily mean that one is able to pay, and made a plea on behalf of his constituents that ability to pay should be taken into account. My hon. Friend the Member for Braintree (Mr. Newmark) made a similar point, echoing the concerns of his constituents in Essex.
	The debate got even better because 100 per cent. of the Welsh Conservative party contributed to it, which is unusual, bearing in mind that this is an English Bill, but it shows the salience of the council tax issue for our neighbours in Wales, who have just been through a revaluation. There is no doubt that the Government considered some of the outcomes of the revaluation in Wales before they determined what to do.
	My hon. Friend the Member for Monmouth (David   T.C. Davies) talked about the concerns about revaluation and the hefty rises in his constituency. My hon. Friend the Member for Preseli Pembrokeshire (Mr.   Crabb) said that assurances were given to the Welsh Assembly that the process would be revenue neutral and it was not. My hon. Friend the Member for Clwyd, West (Mr. Jones) echoed the concerns about the revaluation in Wales. He talked about the rising anger and the 9 per cent. uplift in the yield post revaluation.
	The hon. Member for Leicester, South (Sir Peter Soulsby) again showed his experience as a leader of Leicester city council and talked eloquently and concisely about his concerns. He did not want the revaluation to be put off for too long, but talked a great deal about function and funding and supported the Government's review and the Lyons review.
	The hon. Member for High Peak (Tom Levitt) came in and did a reasonable job of keeping the debate going. The hon. Member for Colne Valley (Kali Mountford) did extremely well to speak for well over 30 minutes and, on the whole, to keep in order. The hon. Member for Wolverhampton, South-West (Rob Marris) showed the benefits of the Library brief, taking us into the history of revaluation. He made the salient point that revaluation, whether under the rates system or the council tax system, has always meant Governments of all political colours facing difficult choices and they do not always make the right one. I am sure that as he made an eloquent speech and made some good points, he will soon get a well-deserved promotion to the Government.
	The debate is of the Government's own making. Revaluation was not part of the 1992 Act, but the Government decided in July 2001 to revalue council tax on 1 April 2007. That was in the Local Government Act   2003, for which many Labour Members voted.   Conservative Members voted for a reasoned amendment. I had the pleasure of serving on the Committee that considered the Bill. The fact that the Government have changed their minds and are accusing all sorts of people on the Opposition Benches of changing their minds has a lot to do with the fact that they decided to go down that political avenue and have now thought better of it.
	We heard a lot about kicking issues into touch and about panic attacks. It is probably sensible for the Minister to put off revaluation because the salience of the council tax issue is high and increasing. The Welsh experience is a useful one. The Royal Institution of Chartered Surveyors estimates that, if we had the same uplift following the English revaluation as occurred in Wales, that would mean £2 billion extra in council tax, and that council tax for 7 million out of 21 million council tax payers would go up. Those are big figures, which have no doubt concerned the Government and were one of the reasons why they decided to kick the issue into touch.
	Revaluation itself is a costly exercise. In 2004, the cost was estimated at £108 million and, in 2005, at £178 million. We got so far as to spend nearly £60 million, of which £45 million, we heard, was spent on software. I am not sure that we received an answer about the value of the software if the revaluation is put off, and I hope that the Minister will reassure us on that.
	We heard that the Valuation Office Agency has taken on nearly 1,400 staff to deal with revaluation, many of whom will be on short-term contracts. We have not heard very much about the cost of those appointments. The Government said that there would be savings and, of course, there will be savings, but there will be further costs to come from shortening the contracts of 1,400 staff.
	The hon. Member for South Ribble said that, within the cycle, it would be possible to use those staff and others to undertake a revaluation of council tax and then to get back to the cycle for the revaluation of the uniform business rate. However, the whole thing is now out of synch.

Rob Marris: Is the hon. Gentleman as surprised as I   am that paragraph 10 of the explanatory note says that
	"The Regulatory Impact Unit has confirmed that no Regulatory Impact Assessment is required"?

Robert Syms: I am surprised.
	Council tax is an important issue because a lot of people feel that the basis of its funding and the distribution between the various regions of the UK is not fair. The gearing effect, about which we have heard much today, means that it is difficult for local authorities to keep the rate of increase in council tax down to the rate of inflation. As we have heard, since 1997 council tax has increased by well over 76 per cent., which is why the issue is particularly salient politically. No doubt that is why we have ended up with a Bill to put off the revaluation.
	The Opposition are concerned because the Government have some form in terms of the way in which they distribute grants. Over the past eight years, we have been concerned about how money is redistributed to the various regions, which is one of the reasons why we want to show our displeasure in a vote tonight. We are concerned about the impact on many areas in terms of grants.
	The other concern is that the Government have taken powers to change the bands, and to introduce more bands, to make council tax more progressive, which can be done by altering the various elements in a revaluation. If we have a revaluation and new bands are introduced at that point, we will have a very different tax from that introduced in 1993. There are concerns about the way in which the process will be dealt with and we need reassurances about a transitional relief scheme. When there are winners and losers, it is important to offset the increases for a period so that people become used to the new rate.
	The Sunday newspapers referred to the Valuation Office Agency's computers, particularly the various codes being put in to value housing. My hon. Friend the   Member for Brentwood and Ongar (Mr. Pickles) went into detail about the issues of concern raised by The Sunday Telegraph and there is concern about the amount of information going into computer software and how it will be used to vary particular bands.
	If we get to a situation where a view across a golf course or over the sea, or the condition of people's patios and gardens, starts to play a role in council tax, people will be suspicious that revaluation will not be a neutral exercise but will instead raise a great deal of money. Those concerns need to be addressed. There is concern over council tax and over the distribution of grant.

David Borrow: Will the hon. Gentleman clarify the position of the Conservative party? Is it in favour of a 2007 revaluation? If not, why has it tabled an amendment that would have the effect of ensuring that a 2007 revaluation takes place?—[Interruption.]

Robert Syms: Labour Members doubtless fought very hard in their constituencies during the election, but our position in that election was that we opposed revaluation for the first term of a Conservative Government. Unfortunately, we did not win, but our position remains perfectly clear: we are opposed to revaluation. We want to make clear our displeasure at the direction of Government policy, particularly given that many of our constituents are concerned about grant distribution, banding and the question of a more progressive council tax. Many other such issues concern my hon. Friends, and we wish to register our displeasure at the way in which the Government have conducted their policy.

Tom Levitt: The hon. Gentleman is describing a most extraordinary position. In effect, he is saying that he is relying on losing the vote at 10 o'clock in order to maintain his policy.

Robert Syms: I am always hopeful when I go into the Division Lobby, but heads would doubtless roll—probably not mine—if we won this evening's vote.
	The council tax is an issue that concerns many of our constituents. Many petitions on the council tax have been handed into this House by various campaigns, and many people are asset rich but income poor. The salience of this issue has increased, and Government policies in recent years have led many to believe that the council tax is becoming a stealth tax. We will register our disappointment at the direction of Government policy in recent years. I ask my right hon. and hon. Friends to support our amendment.

Phil Woolas: What a letting of the cat out of the bag we have   witnessed this evening! With all due respect to Her   Majesty and her relationship with her Loyal Opposition, I would ask for my money back. The once-great Conservative party has been reduced to something of a pickle. The amendment before us in the name of the right hon. and learned Gentleman the   Leader of the Opposition is worth quoting:
	"That this House declines to give a Second Reading to the Council Tax (New Valuation Lists for England) Bill because the Bill merely delays rather than cancels the council tax revaluation".
	That is a consistent position—since 7 April. Of course, were the amendment accepted, revaluation would be reintroduced with effect from 1 April 2007.
	Although this point has been made several times today, let me emphasise that the Conservatives' strategy since their U-turn in the spring has been to scaremonger. That campaign has been based—another Conservative Member also let the cat out of the bag in this respect—on exploiting the fear of many, especially pensioners and the low paid, that because the value of their house has increased, it follows that a banding increase will take place. Nothing could be further from the truth.

Several hon. Members: rose—

Phil Woolas: The Conservatives should listen to the argument. They get very excited about revaluation. It brought an end to their Prime Minister, Mrs. Thatcher, and they know the damage that that caused them.
	The second myth that has been perpetuated, and which was repeated in some of last weekend's newspapers in a rehashed story from some dim and distant period during the summer recess, is the amazing revelation that—surprise, surprise—in valuing a property, valuers take on board the attributes of that property. Well, blow me down, the number of bedrooms is taken into account in the valuation of a property. Presumably, whether a property has a swimming pool, a conservatory, an attic or a golden garden shed will also be taken account in the valuation. Of course, the valuation office also takes into account certain attributes that work in the opposite, negative direction. If a property is located in front of a chemical works, for example, the house price may well go down—goodness me! If the front of a house has a bad view, the value of the property may go down. As I say, Madam Deputy Speaker, blow me down with a feather!
	Her Majesty's loyal Opposition, who are fighting among themselves over the election of a new leader, based on the premise that they must have credible policies, have tabled an amendment before the House, the effect of which would be the precise opposite of what they have argued. The party's spokespersons have repeatedly said over the years that we cannot have a property tax without a revaluation, but they are now telling the House that we must have a property tax   without any revaluation. That is not so much a U-turn—at least we are honest about ours—as a double U-turn.
	Let me remind the House that, in opening the debate for the Conservatives, the hon. Member for Brentwood and Ongar (Mr. Pickles) said, first, that he agreed with the postponement. That is what he said and that is what the Bill does. Secondly, he agreed that we should not have a 10-year limit in terms of the revaluation cycle. Thirdly, he said that his only problem was with the secondary legislation, to which I shall return in a few moments.
	But the Opposition have tabled an amendment that would have the effect of going ahead with revaluation, though they agree with the postponement. They are going to the country saying that they want to put forward credible policies, yet they obviously do not have them. I suspect that the amendment before us was written in the Whips Office. In the rush to get away last Thursday, the Whips realised that they had to amend the motion on the Opposition day debate that they called, and I suspect that today's amendment was written in haste. I also suspect that the words used at the Dispatch Box in today's debate will feature in many a local election leaflet drawn up by my party as we approach next May. They are quite probably already in a "Focus" leaflet and on their way out.
	The hon. Member for Brentwood and Ongar, repeating something that he read in the newspapers this weekend, said that we are introducing a tax on views, but valuation officers have always taken the attributes of a property into account.

David Borrow: rose—

Phil Woolas: Here we have an expert to confirm my point of view.

David Borrow: Did my hon. Friend see the photographs in the newspapers over the last few days of a fairly modest bungalow—in Dorset, I believe—that was up for sale for about £1 million? The bungalow looked similar to many properties in my constituency and, doubtless, in my hon. Friend's constituency. Does he believe that all those properties should be in the same tax band?

Phil Woolas: My hon. Friend, who is an acknowledged expert in valuation, makes a valid point, which brings me on to the next myth that the Conservatives have been trying to peddle—the idea that somehow or other, one's council tax band is based on an absolute and not a relative value. Many hon. Members will be familiar with the differences in house, flat and apartment prices between Westminster and their own constituencies. Are we to say that council tax should be based on absolute and not relative prices? I do not think so, yet that is the rather cynical myth that was perpetuated by the Conservative party in the run-up to the general election. It explains their U-turn of spring this year and it explains why they are now in a complete mess in respect of one of the most important domestic policy issues that we face.
	I shall reply to some of the other points that have been made in what has been a very interesting debate. The hon. Member for Brentwood and Ongar said that it was an established fact that prices have aligned across the country. He also repeated what he has said elsewhere that the variations in price would mean that revaluation would cause chaos. Both statements cannot be true. Either prices have aligned, which would mean no turbulence would be caused by revaluation, or we would need revaluation because prices have not aligned. Which is it? I suspect that the answer depends on which camp one is talking to, and it will be interesting to see the result.
	The Conservatives also suggested that Northern Ireland was a guinea pig. That is another urban myth and completely misunderstands the point that Northern Ireland is moving from a rental to a capital base for its property tax. One does not hear the Conservatives' point made by Members from Northern Ireland, and I   suspect that it is made for entirely political reasons.
	The hon. Gentleman also claimed that council tax benefit take-up has declined during this Government's term. Well, I agree, but I find the answer as to why in The Mail on Sunday.

Rob Marris: It cannot be true then.

Phil Woolas: Well, it was in the financial pages. On 6 November, not 24 hours ago, it was stated that rising wages and lower unemployment have lifted more than 600,000 households out of the net for council tax benefit. So people are better off under a Labour Government and are less dependent on benefits.

Eric Pickles: The Minister would do well to listen carefully to what Members say. My point was not about numbers, but about eligibility. The numbers show that those who are eligible are not claiming.

Phil Woolas: I did listen to the hon. Gentleman closely, and that is why I referred to the article in The   Mail on Sunday before I referred to the proportion claiming and I shall put on record the position regarding council tax benefit. Nobody in this country is being sent to jail because they cannot afford their council tax. Judges do not do that. The only circumstances in which one can be imprisoned for not paying one's council tax is if one is unwilling to pay it. There have been two such cases in the past year—Alfred Ridley and Sylvia Hardy. Opposition Members are trying to whip up a storm on the back of the IsItFair campaign and, in my view, they are exploiting people. Through their scaremongering, they are scaring people, many of them low paid and vulnerable. The Government will not allow that to happen.
	The income of pensioners has risen immeasurably under this Government—

Philip Hammond: Some £200!

Phil Woolas: The £200 extra help with the council tax was opposed by the Opposition. Pensioners in receipt of the guaranteed pension credit get a 100 per cent. rebate of council tax. Of course, it is our policy to improve take-up and I join with the hon. Member for Brentwood and Ongar in making that point. I hope that he will join our campaign, in a non-partisan manner, to encourage take-up of the benefit by pensioners by explaining its advantages. But I would wager that not many people in receipt of, or entitled to, council tax benefit cross the door of the hon. Gentleman.

Eric Pickles: That is outrageous.

Phil Woolas: If I had the time I should like to enter into a debate on the workings of council tax benefit, as it clearly covers—

Madam Deputy Speaker: Order. The hon. Gentleman may like to enter that debate, but he will not be allowed to do so while we are discussing the Bill.

Phil Woolas: Thank you, Madam Deputy Speaker, for your firm chairing of this important debate. I   emphasise the point that I would like to enter such a debate, but I understand why it is not possible.
	My right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford) made a characteristically well-informed and authoritative speech and argued against postponement of the revaluation. I again point out, to reassure him and my hon. Friend the Member for   Colne Valley (Kali Mountford) who also spoke on   the matter, that the Bill is a postponement not a cancellation. It may give Members further reassurance to know that the Government could have taken the option to propose simply to cancel the legislation in the Local Government 2003 Act, which amended the Local Government Finance Act 1992. We chose not to do that but to include in our Bill the commitment to introduce revaluation at the appropriate time, following the Lyons review. I hope that my right hon. Friend the Member for Greenwich and Woolwich will accept that reassurance.

Nick Raynsford: I am grateful to my hon. Friend, but can he tell the House when he and the Government envisage that power being used? The point has been made clearly during the debate that, due to the need to   avoid a clash with the valuation for business rates, 2010 is not possible, but 2011 and the period immediately afterwards would be. Is my hon. Friend prepared to give us an undertaking that the Government will proceed with a revaluation on that timetable?

Phil Woolas: My right hon. Friend makes an important point. The investment in the Valuation Office Agency—the computerisation, entering information and ongoing work—means that it can give me assurances that it will have the capacity to ensure that those revaluations can take place, if necessary, should Parliament decide on a concurrent timetable. The problem that my right hon. Friend raised is being solved—[Interruption.]

Madam Deputy Speaker: Order. Far too many extraneous conversations are going on in the Chamber.

Phil Woolas: It may be helpful if I remind the House of the words of my right hon. Friend the Minister of Communities and Local Government at the beginning of the debate. He outlined our commitment to local government, our belief that it is at the heart of national life and that it has a unique role—

David Curry: Will the hon. Gentleman give way?

Phil Woolas: In just one second.[Hon. Members:"Give way."] Members might have let me finish my sentence, but I shall of course give way to the distinguished former Minister, if only to remind the   House that the right hon. Gentleman spoke against his Front-Bench policy.

David Curry: The right hon. Member for Greenwich and Woolwich (Mr. Raynsford) did not ask the Minister whether he had the capacity to carry out a revaluation; he asked him whether he had the intention to order a revaluation in 2011. What is the answer?

Phil Woolas: The right hon. Gentleman made a learned speech earlier and I think—

Malcolm Moss: Answer the question.

Phil Woolas: The hon. Gentleman must listen and be patient.
	As the right hon. Member for Skipton and Ripon will know, because he has read the Bill, it proposes that the powers for legislation for revaluation be given to the Secretary of State with the proviso that the House, through affirmative resolution, has the opportunity to debate the matter. Rightly so. That should give him the commitment that he is looking for, but the strategy outlined by the Government and in the comments made by my right hon. Friend the Minister of Communities and Local Government ensures that there is the opportunity to review local government's role and functions. Taking on board the important new work that has been done specifically under local area agreements, the three-year local government finance settlement and the certainty and stability needed for all involved requires a serious review of the local government's role and functions. That review is being undertaken on our behalf by Sir Michael Lyons, and I   am sure that many hon. Members on both sides of the House have and will contribute to that important debate. [Interruption.]

Madam Deputy Speaker: Order. Once again, I appeal to the House to come to order. Some Members have been here listening to the debate throughout. Will those who have just come in have the courtesy to allow the Minister to continue?

Phil Woolas: Thank you very much, Madam Deputy Speaker.

David Curry: We are all familiar with the fact that the House may agree or disagree with a Minister's proposition, but the House does not do so on the basis of some existential musing: it does so because a Minister asks it to do so. Does the Minister intend to ask the House to proceed with a revaluation in the time scale mentioned by the right hon. Member for Greenwich and Woolwich?

Phil Woolas: As the statement of 20 September and as my right hon. Friend has made clear, our policy is to ensure that, following Sir Michael Lyons's review, at the right time—we have said that we do not believe that that   will be in the lifetime of this Parliament—we will introduce in the House proposals for revaluation, and that is why on several occasions at the Dispatch Box my right hon. Friend and I have been able to reassure those who take the right hon. Gentleman's point of view that   this is a postponement, not a cancellation of revaluation.

David Borrow: My hon. Friend has been generous in giving way. May I try to help him on this point yet again? Many hon. Members wish to be reassured about whether he recognises that the longer the current council tax list continues without a revaluation, the more that list becomes unstable and unsustainable.

Phil Woolas: My hon. Friend made that point in the debate. Of course, the answer depends on what happens to house prices. If he is asking whether the Government's policy is to support a property tax on the   basis of valuation, the answer is, of course, yes—unlike the Conservative party's policy of supporting property tax without a revaluation, which seems wholly untenable.
	Hon. Members have argued in the debate that there is no need for revaluation. They argue that relative house price movements across the country during the past 10 years are such that the revaluation is unnecessary. They would cancel revaluation, rather than postponing it. However, during the debate of 19 October, when the hon. Member for Upminster (Angela Watkinson) was challenged by my hon. Friend the Member for Sheffield, Attercliffe (Mr. Betts) to say whether the Conservatives would ever revalue, the response was, "We never say never". We look forward to receiving the Opposition's support for the Bill when it returns to the House after its consideration in Committee because it provides exactly the kind of flexibility that their policy appears to call for.
	Finally, I should remind the House that in the past eight years, the Government have provided a 33 per cent. real-terms increase in Government grant, which compares with a 7 per cent. real-terms reduction in the last four years of the previous Government. Last year was the eighth successive year in which the Government provided local government overall with an increase in total Government grant that was above inflation, and it was the third year in which we were able to guarantee increases for all local authorities at least in line with   inflation. One would have thought that the Conservative party would be interested in balancing the books, not scaring the pensioners of this country.
	Question put, That the amendment be made:—
	The House proceeded to a Division, and Madam Deputy Speaker having directed that the doors be locked—

Madam Deputy Speaker: Order. There has been a mistake in the timing on the clock. Doorkeepers, please unlock the doors.
	Whereupon the doors were unlocked.

The House having divided: Ayes 166, Noes 338.

Question accordingly negatived.
	Main Question put forthwith, pursuant to Standing Order No. 62 (Amendment on second or third reading) and agreed to.
	Bill accordingly read a Second time.

COUNCIL TAX (NEW VALUATION LISTS FOR ENGLAND) BILL (PROGRAMME)

Motion made, and Question put forthwith, pursuant to Standing Order No. 83A(6)(Programme motions),
	That the following provisions shall apply to the Council Tax (New Valuation Lists for England) Bill:
	Committal
	1. The Bill shall be committed to a Standing Committee.
	Proceedings in Standing Committee
	2. Proceedings in the Standing Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 17th November 2005.
	3. The Standing Committee shall have leave to sit twice on the first day on which it meets.
	Consideration and Third Reading
	4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.
	5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
	6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on consideration and Third Reading.
	Other proceedings
	7. Any other proceedings on the Bill (including any proceedings on consideration of Lords Amendments or on any further messages from the Lords) may be programmed.—[Mr. Watts.]
	The House divided: Ayes 334, Noes 166.

Question accordingly agreed to.

DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Constitutional Law

That the draft Water Services etc. (Scotland) Act 2005 (Consequential Provisions and Modifications) Order 2005, which was laid before this House on 10th October, be approved.—[Mr. Watts.]
	Question agreed to.
	Motion made, and Question put forthwith, pursuant to Standing Order No. 119(9) (Standing Committees on Delegated Legislation),

European Union Arms Exports

That this House takes note of the Unnumbered Explanatory Memorandum dated 4th July 2005 from the Foreign and Commonwealth Office on the Common Position Defining Rules Governing the Control of Exports of Military Technology and Equipment; and agrees with the Government that the Common   Position will be an improvement to EU arms control.—[Mr. Watts.]
	Question agreed to.

PETITIONS
	 — 
	      IsItFair Campaign

Robert Syms: I wish to present a petition of the IsItFair council tax campaign, consisting of 401 signatures collected by Mrs. Barbara Brown of Poole, which raises real concern about the level of council tax.
	To the House of Commons.
	The Petition of the IsItFair council tax protest campaign declares:
	That the year-on-year, inflation-busting increases in Council Tax are causing hardship to many and take no account of ability to pay; further, that the proposed property revaluation and re-banding exercise will make an already flawed system even worse.
	The Petitioners therefore request that the House of Commons votes to replace Council Tax with a fair and equitable tax that, without recourse to any supplementary benefit, takes into account ability to pay from disposable income. Such tax to be based on a system that is free from any geographical or politically motivated discrimination, and that clearly identifies the fiscal and managerial responsibilities of all involved parties.
	And the Petitioners remain, etc.
	To lie upon the Table.

Malcolm Moss: It is my privilege to present a petition on behalf   of my constituents, a list of names collected by Mr. C. Perrin of March, a town in my constituency. It is part of the IsItFair council tax protest campaign. I do not necessarily agree with the campaign's conclusions, but I certainly agree with the thrust of the campaign, which is that this Government have used council tax as a means of stealth taxing huge swaths of our population who can hardly afford the levels of council tax that are now being charged. I personally do not agree with the idea behind the petition, which is completely to remove council tax and replace it with an alternative, which I   suppose would have to be income tax. I believe that a property-based tax is a sensible way forward, and it would not take a massive injection of Government money from general taxation, including income tax, to bring the levels of council tax down to a more manageable level.
	The Petitioners therefore request that the House of Commons votes to replace Council Tax with a fair and equitable tax that, without recourse to any supplementary benefit, takes into account ability to pay from disposable income. Such tax to be based on a system that is free from any geographical or politically motivated discrimination, and that clearly identifies the fiscal and managerial responsibilities of all involved parties.
	To lie upon the Table.

Philip Davies: I, too, have great pleasure in presenting a petition that has been collected by my constituent, Mr. Perry, in Burley in Wharfedale, which is a lovely part of my constituency. The signatures that he has collected have all come from Burley in Wharfedale. This petition is also part of the IsItFair council tax protest campaign.
	The Petitioners declare:
	That the year-on-year, inflation-busting increases in Council Tax are causing hardship to many and take no account of ability   to pay; further, that the proposed property revaluation and re-banding exercise will make an already flawed system even worse.
	The Petitioners therefore request that the House of Commons votes to replace Council Tax with a fair and equitable tax that, without recourse to any supplementary benefit, takes into account ability to pay from disposable income. Such tax to be based on a system that is free from any geographical or politically motivated discrimination, and that clearly identifies the fiscal and managerial responsibilities of all involved parties.
	And the Petitioners remain, etc.
	To lie upon the Table.

Surbiton Hospital

Edward Davey: I have the privilege to present to the House of Commons a petition on behalf of more than 7,000 of my constituents in Surbiton and across the royal borough of Kingston upon Thames, collected through the good offices of the Surrey Comet, its editor Sean Duggan and assistant editor Colin O'Toole.
	The petition declares:
	That widespread public opposition exists to the current proposals from Kingston Primary Care Trust to move in-patients and out-patients from the site of Surbiton Hospital and that there has been no public consultation on whether to move in-patients.
	The Petitioners therefore request that the House of Commons urges the Secretary of State for Health to intervene to halt the planned axing of services at Surbiton Hospital and to prevent any major changes at the hospital until there has been full public consultation.
	The Petitioners further request that this House of Commons urges the Secretary of State for Health to ensure that any redevelopment on the site should be used to improve, not reduce, the provision of health services at Surbiton Hospital.
	And the Petitioners remain, etc.
	To lie upon the Table.

IsItFair Campaign

Bob Spink: I wish to present a petition compiled by Mrs. Vile and others who live in Hadleigh. The petition forms part of the IsItFair campaign. It is supported by the Royal British Legion, which represents those who made this country great, to whom we should listen, particularly this week as we approach 11 November.
	The council tax is pernicious and regressive. It has risen by 130 per cent. since I entered Parliament, while inflation has risen by only 38 per cent. The council tax needs reform. It is an unacceptable burden on my constituents, particularly the elderly and those on small, fixed and tightly indexed incomes. Like IsItFair, I call on the Government and all local councillors to hold the council tax increase to the rate of inflation and not a penny more, although I disagree with the detailed reform proposals set out by IsItFair.
	The petition states:
	The Petitioners therefore request that the House of Commons votes to replace Council Tax with a fair and equitable tax that, without recourse to any supplementary benefit, takes into account ability to pay from disposable income. Such tax to be based on a system that is free from any geographical or politically motivated discrimination, and that clearly identifies the fiscal and managerial responsibilities of all involved parties.
	And the Petitioners remain, etc.
	To lie upon the Table.

CRIME (MIDDLESBROUGH)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Watts.]

Ashok Kumar: First, may I put on record my great thanks to the Speaker for granting me this debate?
	I want to bring to the attention of the House the work of Middlesbrough borough council, its elected mayor, Ray Mallon, and the Safer Middlesbrough partnership to cut crime and make the town a safer place. First, I   want to praise the efforts of the men and women of Cleveland police, and the force's chief constable, Sean   Price, who has made a great contribution to ensuring that the council's plans have succeeded and provided great leadership.
	The success of the initiative would not, of course, have occurred without the Government, who have provided resources, financial support and strong commitment from the top. They have given a strong commitment to tackling crime and law and order problems, and have assisted the local authority and the partnership to deliver results.
	I naturally want to say a little about the respect agenda which the Prime Minister has led from the front. Middlesbrough, like every urban area, has experienced problems of crime and the rise of the yob culture, but it has actively developed a strategy of policies on the ground rooted in a firm determination to take back the streets and estate from the yobs and petty criminals.
	I must declare an interest. I am a very good friend of the mayor, Ray Mallon, and I respect and admire the leadership that he has given our town. Since his election, he has become a national figure. Many Government and Opposition Front Benchers visit his office regularly. It has also been visited by Lord Falconer, the Lord Chancellor, by the Secretary of State for Northern Ireland and Wales, by the Minister of Communities and Local Government and, of course, by the Leader of Her   Majesty's Opposition. Both candidates for the Conservative party leadership have visited Ray Mallon and sought his counsel, and the great and the good of the Labour party establishment also visit and seek his support. He commands a great deal of respect at national level, and he too leads from the front.
	When Ray Mallon ran for office, he made it clear that tackling crime and disorder was one of his top priorities. He has delivered on that pledge, and the success of his approach is reflected in the fact that on the tough urban beat of Middlesbrough, crime has fallen by 20 per cent. since he became mayor. His first act, which he performed only months after taking office, was to launch an initiative called "Raising Hope". Raising hopes and expectations of an effective crackdown on crime, bad manners and loutish behaviour was and is the key priority for everyone in the town.
	I know that directly from my constituency postbag, and also from the comments of people whom I meet in the streets, in their workplaces and at a series of coffee mornings that I hold throughout my constituency. For them, knowing that action is being taken to tackle crime and antisocial behaviour is the key to the hope of a   better quality of life. "Raising Hope" is truly a partnership approach, based on Ray Mallon's appreciation of the realities of policing in areas where the louts have established a dominant foothold. It is an   intelligence-led approach, and the police share data   and information on a daily basis. They work with   other control agencies, notably the council and its street-warden service, but also local businesses, retailers, pubs and clubs and schools. Their approach links the panda car with the CCTV operator, the school head fighting truancy with the mobile truant patrols in the town centre, and the street warden with the local shop. Above all, it links all those agencies in a relationship with the people and communities of the town.
	Mayor Mallon's philosophy is holistic. To him, a clean, safe environment is one in which crime and antisocial behaviour are driven to the margins. To him, a confident community is one that knows it can report vandals and petty criminals to the authorities, who will listen to their concerns and take action against those who are reported. He also recognises that inequalities and divisions in local society, between rich and poor, young and old and black and white, create an environment in which crime and intolerance can flourish. He argues for the need to rebuild a 19th century industrial town as a new city fit for the 21st century, a city with new businesses, new jobs, new forms of leisure and consumption and clean, swift, efficient transport rising from the foundations of the old. Although all those priorities are ends in themselves, they all play a key role in crime eradication and in making Middlesbrough a truly safe community.
	Ray Mallon has used the legislation provided by successive Government Acts and initiatives to structure his approach. Crucial legislation for him was the Crime and Disorder Act 1998 from the Home Office and the   Office of the Deputy Prime Minister's Local Government Act 2003. Combining the crime-fighting powers conferred on councils and elected mayors by   that legislation, he was able to weave together an all-embracing culture in the council and, crucially, outside it.
	Ray Mallon has told me of his frustration with those agencies that publish glossy mission statements and strategy documents and then retire from activity. Those agencies are convinced that, by merely drawing up those   documents, they have fulfilled their obligations to their stakeholders and clients. He has told me that he feels that that is one key reason why there is so much cynicism among the general public over the effectiveness of crime-busting measures.
	In order to sell his mission to the people of Middlesbrough, Ray Mallon embarked on a comprehensive road show engaging in debate and discussion with people across the town. I have been present with him at many of those events and he in turn has been prepared to assist me when I have held similar "meet the people" sessions in the part of Middlesbrough that lies in my constituency.
	Ray Mallon takes a personal interest in listening to the people on the front line of local government. Too many councillors, he argues, relate only to chief executives, policy officers and departmental heads. He listens to people in local government such as street wardens, road sweepers, toilet attendants, lollipop ladies and home carers, who seldom, if ever, get to meet their councillors face to face to give their views on the service that they provide and how it could be improved. Mayor Mallon regularly drops in at depots and offices to hear what those employees say and he believes that it has paid dividends.
	Mayor Mallon also recognises that many of the problems facing local communities suffering from crime and antisocial behaviour come from the activities of local young people. He and his cabinet, most notably Councillor Barry Coppinger, the council's lead member for community security, see diversionary activity as the key to peeling youngsters off the road to crime.
	The local drug scene is an example. The headlines talk of crack and heroin. Sadly, crack and heroin abuse does exist in our community. Indeed, much of that abuse contributes to the basic motivation of most of the muggings and burglaries that take place across Middlesbrough. A crack or heroin addict needs constantly to replenish his or her high and usually it is someone else's money, handbag or cash till that becomes the target. That is why the crackdown on hard drugs is central for both Cleveland police and the council's community wardens.
	However, far more common than hard drugs is the use of so-called recreational drugs for Saturday night fever—mainly ecstasy and other amphetamines. The   council's drug strategy reflects that division. The strategy and council staff back Cleveland police 100 per cent. in their "get a dealer a day" campaign and in their work of identifying, targeting and then raiding crack and heroin dens, but they also run education programmes across schools, youth clubs and colleges, alerting youngsters to the dangers posed by the abuse of recreational drugs and to what that abuse can lead to.
	Youth activity and empowerment is central to the council. A small sum spent on a youth centre in an informal setting on an estate, or a minor shift of moneys from the mainstream education budget to a special diversionary scheme run at a street level can bring great rewards. It can pay valuable dividends for the future and can be achieved easily and effortlessly if the will is there.
	The alternative, of course, is to do nothing. That may safeguard the sanctity of a local council's or school's budget in the short term, but will cost society heavily in the years to come. It can cost heavily as antisocial behaviour or teenage deviancy becomes the modus operandi of sub-criminal and criminal behaviour in early adulthood. That is why the need to ensure the success of the respect agenda is so vital.
	We have to remember that we all pay a price for allowing criminality to flourish unchecked. There is the human price wreaked on the powerless and vulnerable by the activities of the thugs and the hooligans, and the   physical price of constantly having to resource an ever-expanding police and community security budget, let alone the price of running an effective offender management service and the Prison Service.
	For the respect agenda to take root and flourish, and for it be accepted for real by a jaded public, it has to be seen as part of an all-embracing and holistic programme that is a core part of the life of the community and adopted by all agencies as central to their work. What has been achieved in Middlesbrough shows the way to roll out the respect agenda across the streets, towns and cities of the United Kingdom. I invite my hon. Friend the Minister to Middlesbrough where he can see for himself what we have been able to achieve.
	What I have articulated today is a real programme for raising the hopes of our people and improving their quality of life. I am sure that my hon. Friend will return from Middlesbrough with a great deal of information that he can use for the subsequent respect agenda.

Paul Goggins: I begin by congratulating my hon. Friend the Member for Middlesbrough, South and East Cleveland (Dr. Kumar) on securing this debate. Tackling local crime is an important issue for all right hon. and hon. Members and I   am glad that he had the opportunity to air his views. I pay tribute to his personal role in bearing down on criminality in his constituency.
	My hon. Friend kindly invited me to come to Middlesbrough to see some of these things for myself. I   paid a private visit to his constituency as recently as last Saturday; sadly, it was to attend the funeral of a very dear friend of mine, David Boyes. I hope to return in happier times.
	I am grateful to my hon. Friend for his forthright and considered assessment of the current position on crime and disorder in Middlesbrough. He attributed considerable credit to the elected mayor and it was encouraging to hear his observation that the residents of Middlesbrough are pleased with the progress that is being made. The local crime and disorder reduction partnership is making a real difference and I am pleased to join my hon. Friend in praising the local police. I was particularly pleased to hear him emphasise the way in which the agencies in the Middlesbrough area are working well together and making the best use of the available resources.
	This debate comes at a very opportune time as the   crime and disorder reduction partnership in Middlesbrough has undergone a number of changes recently. It is now in a better position to deliver its ambitious target of reducing crime by over 20 per cent. by 2008. Such a target is not an end in itself but, if achieved, will have a considerable impact on the safety and confidence of my hon. Friend's constituents.
	I will comment in more detail on the situation in Middlesbrough in a moment, but first, I should like to set the context by saying one or two things about the Government's overall strategy for reducing crime and the progress that we are making.
	Although it is true that our constituents remain understandably worried about crime and still perceive it as one of the main issues that the Government need to address, in fact, crime in England and Wales has been falling dramatically over the past decade. Since 1997, overall crime as measured by the British crime survey is down by 35 per cent., with particularly significant reductions in domestic burglary and vehicle crime. According to the BCS, violent crime has reduced by 34 per cent. in the same period.
	However, such progress is meaningful only if it is translated from percentages into something practical and real at local level that enables local communities to feel safer and to be more secure. I am very grateful to my hon. Friend for explaining how this strategy applies in a challenging urban area such as Middlesbrough, which experiences a wide range of crime-related problems. I   am certainly pleased to hear positive feedback about   how crime and disorder is being tackled in Middlesbrough, and how the local community's concerns are being taken fully into account.
	As I said at the beginning, this is a good time to talk about crime and disorder in Middlesbrough. This year, the Audit Commission found evidence that fear of crime in Middlesbrough appears to be reducing—a feeling supported by recent significant reductions in vehicle crime and robbery. Acquisitive crime—such crime is often associated with drug misuse, as my hon. Friend said—has also reduced significantly overall, pointing to the success of programmes and initiatives such as the drug interventions programme, which is targeted at drug misusers caught in the criminal justice system, and   the prolific and priority offenders programme. The   latter is targeted at those who commit a disproportionate amount of crime and disorder in our communities.
	This progress was noted during self-assessment of the prolific offenders scheme that was recently conducted in   collaboration with the Government office for the north-east. The scheme was particularly strong in areas such as performance management and establishing good practice. The interim evaluation report on the national prolific offenders strategy, which was published just a couple of weeks ago, suggests that the scheme may be having a positive impact on re-offending among this hard core group. I will follow the progress of the Middlesbrough scheme with great interest following this debate. Some other partnerships in the area are also having a positive impact. For example, the Cleveland local criminal justice board is bringing agencies together to ensure, for example, that a larger number of offenders are brought to justice, and that greater community confidence can be built throughout the local area.
	Following the 2004 crime and disorder audit in Middlesbrough, extensive consultation took place involving community organisations, businesses and other stakeholders, in order to help set out the local strategy for the period 2005–08. Respondents were asked about their main priorities for the partnership to tackle, and the following five themes were identified as being of greatest concern: antisocial behaviour, misuse of drugs, house burglary, robbery and mugging, and street violence. As a result of this consultation, the Safer Middlesbrough partnership has agreed an ambitious 20.1 per cent. crime reduction target for the period 2005–08. This target includes a reduction in common assault and wounding of 30 per cent. The partnership has been restructured to integrate drug and crime issues fully under a new chair and a new executive. Although the partnership faces a period of change, local people have every reason to be positive about the changes that have been made, which should ensure that the right structures are in place to deliver the area's crime reduction target.
	Other welcome developments include the introduction of four problem-solving groups to cover the whole of Middlesbrough, in alignment with the community policing areas. The partnership is also implementing initiatives to address drug and alcohol-related violent crime.
	I would also like to commend the partnership agencies in Middlesbrough for their success in tackling antisocial behaviour, using a range of effective tactics, such as antisocial behaviour orders and dispersal orders, to make the streets and neighbourhoods safer. My hon. Friend mentioned and laid great emphasis on the respect agenda, which is being led from the centre and right across government, introducing a range of practical measures to deal with disorder and change the culture so that we can remove fear and enable people to feel safer in their own homes and on their streets. My hon. Friend was quite right to emphasise that it is the poor and the vulnerable who suffer most when people show disrespect in our local communities. Dealing with the problem is very much a matter of social justice.
	In support of those improvements, Government investment in Middlesbrough is increasing. During the current year, the Safer Middlesbrough partnership will receive a total of £345,220 from the Home Office element of the safer stronger communities fund. That will be   used to help achieve the agreed crime reduction targets as well as local priorities and includes £25,000 specifically to tackle antisocial behaviour.

Greg Clark: The Minister rightly makes great play of the importance of reducing drug offending, especially among young people, but does he accept that in order to get young people off   drugs, they have to go through a period of rehabilitation? However, there is currently only one place in rehab for every 10 juvenile drug addicts, so will he clarify how he intends to deal with that problem, not just in Middlesbrough but throughout the country more widely?

Paul Goggins: I would be happy to make a few remarks that I intended to make in any event about drug misusers, particularly young people, and how best to deal with them. The best way to get them off drugs is to   prevent them from getting into drugs in the first place. That can help enormously and result in fewer victims of crime around the areas where they steal in order to fund their drug habits. Of course, residential rehabilitation can form an important part of a drug programme for a young person, as for an adult, but we need a range of programmes and interventions to make the difference.
	The drug interventions programme is now developing well—not just in Middlesbrough but across the country—and I can tell the hon. Gentleman that in June this year, 2,000 drug misusing offenders came into treatment. That is well on the way to our target of getting 1,000 such offenders into treatment every week by 2008. Of course, once we have got people into treatment, we need to keep them in it to ensure that we reap the full impact—a change in their behaviour. Some of the signs are very encouraging. I attended an event earlier this evening and noted that people at the front line of drug services are developing better ways of ensuring that people stay in treatment. That can change their lives and ensure that they resort to fewer crimes in the future.
	I and my hon. Friend have spoken positively about what is taking place locally and nationally, but there is no room for complacency at either local or national level   and we recognise the disproportionate impact that   crimes of violence can have on the confidence and well-being of a victim and in the wider community. That is why we introduced the Violent Crime Reduction Bill to give the police and local communities the powers that they need to tackle guns, knives and alcohol-related violence. There are a range of measures in the Bill with which my hon. Friend will be familiar.
	We want to give the police and the courts new powers to tackle violent criminals and ensure that they are effectively punished. We want to crack down on imitation firearms and misuse of air guns. We want to raise to 18 the minimum age at which people can buy a knife. We want to give the police powers to require licensed pubs or clubs to search for weapons on entry, and to empower head teachers to search pupils for knives.
	I hope that my hon. Friend will agree that the action that we are taking, the policies that I have described and the figures that I provided earlier all represent a significant achievement. Such achievements are often down to those people who work together at the local level to deliver services that can make a difference.
	Perhaps most important is that the risk of being a victim of crime is now a quarter lower than it was in 1997, which means that 3.3 million fewer people are falling victim to crime. That encourages greater confidence in our communities, helping people to feel safer as fewer neighbours, friends and family members experience the trauma of burglary or robbery. We are also getting a firmer grip on antisocial behaviour and a combination of legislation and strong partnership is working to make our streets and communities safer. As my hon. Friend said, we have set up the respect task force to drive that agenda further forward.
	We are working with our partners—the police, crime and disorder reduction partnerships, the correctional services and many others—to develop a wide-ranging strategy focused on several areas. First, we want to prevent and deter first-time offending, through interventions that deal with the causes of crime and divert young people in particular away from trouble. Secondly, the prolific and other priority offenders strategy targets those who commit most offences. We have plans to reduce the opportunities for crime, including making cars that are harder to steal, designing houses that are more difficult to burgle, creating environments that are safer, and—crucially—giving greater support to victims and witnesses. So much of what the Government have done in recent years has tried to redress the imbalance in the criminal justice system and make it much more in favour of the victims and witnesses of crime, not those who commit crime.
	To complement those plans, we have record numbers not only of police officers, but police support staff, who are trained to carry out specific roles so that police officers can be freed up to protect the public by patrolling the streets where the public want to see them. We now have more than 6,300 community support officers in England and Wales and we are on target to   have 24,000—as promised in our election manifesto—by 2008. Community support officers and neighbourhood wardens, also mentioned by my hon. Friend, have increased the visibility of the police family by reassuring the community and preventing crime. The introduction of CSOs was one of the main planks of our first round of police reform—a process that we are continuing, in consultation with the police service and its partners.
	As I hope this debate has made clear, the Government have placed crime and disorder at the heart of our programme of reform. We are now seeing the results, not least in my hon. Friend's constituency. The Government are committed to building on our reforms and to continue to drive down crime and the fear of crime across our communities, including those represented by my hon. Friend.
	Question put and agreed to.
	Adjourned accordingly at eight minutes past Eleven o'clock.